In a dramatic move to salvage a colossal media merger, billionaire Larry Ellison has personally guaranteed $40 billion (£31.5bn) of his fortune to back his son's ambitious bid for Warner Bros Discovery. The intervention comes after Warner's board raised serious concerns about the financing of the original $108.4 billion (£85.4bn) offer from Paramount Global.
A Father's Backing: From Revocable Trust to Ironclad Guarantee
According to a regulatory filing made public on Monday, the 81-year-old founder of Oracle has agreed to provide an irrevocable personal guarantee for the massive sum. This directly addresses a key complaint from the Warner Bros Discovery board, which last week warned shareholders that Paramount's initial equity commitment relied on an "unknown and opaque revocable trust."
Paramount confirmed the shift in a press release, stating that the elder Ellison is now fully responsible, with the guarantee backed by his entire fortune, estimated at around $240 billion (£189bn). The company pointedly noted that Warner had not previously requested a personal guarantee and revealed that the Ellison family trust holds approximately 1.16 billion shares in Oracle.
Battle for Warner: Paramount's Full Vision vs. Netflix's Streamlined Offer
This fortified bid from Paramount, still valued at $30 per share, sets the stage for a fierce takeover battle. It stands in stark contrast to a competing $82.7 billion (£65.1bn) proposal from streaming giant Netflix. The rival offers have fundamentally different goals:
- Paramount's Vision: Seeks to acquire the entirety of Warner Bros Discovery, including its cable networks like CNN, TBS, and TNT, alongside the studio and streaming assets.
- Netflix's Target: Aims to purchase only Warner's studio and streaming business, leaving the linear television assets behind.
Last week, Warner's board formally deemed the Netflix offer "superior," a stance visually reinforced when Warner CEO David Zaslav gave Netflix co-CEOs Greg Peters and Ted Sarandos a tour of the Warner Bros studio lot.
Strategic Shifts and Political Undertones
The Ellison family's push for control carries potential strategic upheaval for Warner's assets. Sources told The Guardian last month that Larry Ellison, a noted ally of Donald Trump, discussed firing some of CNN's top talent if the deal succeeded during calls with White House officials. He also reportedly considered programming changes, such as airing CBS's 60 Minutes on CNN.
Meanwhile, his son, Paramount CEO David Ellison, has publicly outlined plans to revitalise the storied Hollywood studio by building on its popular franchises. In a letter on Monday, the younger Ellison maintained that Paramount's offer "continues to be the superior option to maximise value for WBD shareholders." He has previously indicated to Zaslav that his bid is not necessarily his "best and final" offer.
Warner Bros Discovery is now expected to respond to Paramount's strengthened proposal later today. Paramount has extended its deadline for Warner shareholders to tender their shares until January 21.
