Paramount on Monday amended its hostile bid for Warner Bros. Discovery, adding an “irrevocable personal guarantee” from Larry Ellison in support of the $108 billion proposal.
WBD last week raised a range of concerns about the offer, noting it had already formally accepted a bid from Netflix for $82.7 billion.
Ellison, one of the world’s richest men, has long been a backer of Skydance, which is run by his son, David. While the elder Ellison is a participant in the proposed WBD transaction, the board of WBD had expressed worry that it was via a trust that could technically be manipulated in unpredictable ways.
“Larry Ellison has agreed to provide an irrevocable personal guarantee of $40.4 billion of the equity financing for the offer and any damages claims against Paramount,” Paramount said in an SEC filing.
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The financial value of the Paramount offer, at $30 a share, is not being amended as part of Monday’s actions.
Paramount also said it was upping its breakup fee (the amount it would pay if a deal does not close) to $5.8 billion from $5 billion, matching Netflix. Larry Ellison has also agreed not to revoke the Ellison family trust, Paramount said, or “adversely transfer its assets during the pendency of the transaction.”
The Ellison family trust owns about 1.16 billion shares of Oracle common stock, Paramount said,, adding that “all material liabilities” of the Ellison family have been publicly disclosed.
In announcing the multi-part amendment to its offer, Paramount criticized the conduct of the merger process. It asserted that that “none” of the WBD board’s concerns, “nor the demand for a personal guarantee, were raised by WBD or its advisors to Paramount in the 12-week period leading up to WBD agreeing to the inferior transaction with Netflix.”
The battle for WBD will reshape the entertainment landscape regardless of who prevails. Both suitors also are likely to invite a high degree of scrutiny from regulators. Just weeks before its chase of WBD became public, Paramount had closed a long-gestating deal to merge with Skydance.
Paramount’s offer is for all of WBD, including its legacy cable networks. Netflix, by contrast, aims to acquire only the studio-and-streaming division that houses Warner Bros. and HBO. WBD had been planning a split into two companies in 2026. Netflix intends to allow the split to go forward before taking over the studio-and-streaming portfolio.
In its latest update, Paramount said it was also extending the deadline for shareholders to January 21 from January 8.
“Paramount has repeatedly demonstrated its commitment to acquiring WBD,” Paramount CEO David Ellison said. “Our $30 per share, fully financed all-cash offer was on December 4, and continues to be, the superior option to maximize value for WBD shareholders. Because of our commitment to investment and growth, our acquisition will be superior for all WBD stakeholders, as a catalyst for greater content production, greater theatrical output, and more consumer choice. We expect the board of directors of WBD to take the necessary steps to secure this value-enhancing transaction and preserve and strengthen an iconic Hollywood treasure for the future.”