Ellison Pledges Massive Equity Backstop to Reinforce Paramount’s Pursuit of Warner Bros Discovery

Key Moments

Ellison Steps In With $40.4 Billion Personal Equity Guarantee

Dec 22 (Reuters) — Oracle co-founder Larry Ellison committed a personal guarantee of $40.4 billion in equity financing to support Paramount Skydance’s $108.4 billion all-cash takeover bid for Warner Bros Discovery, according to a regulatory filing released Monday.

The guarantee aims to ease doubts within the Warner Bros board about Paramount’s ability to fully fund the deal. Previously, concerns over financing certainty and the lack of a broader Ellison family commitment had pushed Warner Bros toward favoring a rival cash-and-stock proposal from Netflix.

Nevertheless, Paramount confirmed that the revised structure does not change the economics of the offer. As a result, the company reiterated its $30-per-share all-cash bid.

Market Reaction and Competitive Positioning

Following the disclosure, Warner Bros shares rose nearly 4% in premarket trading. At the same time, Paramount Skydance gained about 3%.

However, Warner Bros and Netflix did not immediately respond to requests for comment.

Notably, the intensifying battle for Warner Bros Discovery underscores the strategic value of its content portfolio. The winning bidder would secure a major asset in the streaming race by gaining access to a deep and highly sought-after library.

“Paramount remains in a precarious position and is making a last-ditch effort to avoid being left behind,” said Paolo Pescatore, analyst at PP Foresight. “While the revised offer helps, it may still fall short.”

Revised Deal Protections and Tender Timeline

Under the updated structure, Ellison agreed not to revoke the family trust or transfer its assets while the transaction remains pending.

In addition, Paramount strengthened deal protections. Specifically, it raised the regulatory reverse termination fee to $5.8 billion from $5 billion and extended the tender offer deadline to January 21, 2026.

The enhanced proposal follows Warner Bros’ recommendation that shareholders reject Paramount’s $108.4 billion bid for the entire company, including its cable television operations. Management cited lingering doubts over financing certainty at the time.

Even so, some investors have softened their stance. Harris Associates, Warner Bros’ fifth-largest shareholder, said it would consider a revised offer if Paramount addresses earlier concerns and delivers stronger terms.

Regulatory and Political Headwinds

REGULATORY SCRUTINY

Even if shareholders approve a deal, major regulatory hurdles remain. Authorities in both the United States and Europe are expected to closely examine any transaction.

Moreover, lawmakers from both political parties have warned against further consolidation in the media sector. U.S. President Donald Trump has also said he plans to weigh in on the proposed deals.

A merger between Paramount and Warner Bros would create a studio larger than Disney and combine two sizable television businesses. As a result, some Democratic senators argue such a tie-up could concentrate too much control over U.S. media consumption.

By contrast, a Netflix–Warner Bros deal would further strengthen Netflix’s streaming dominance, creating a platform with roughly 428 million subscribers. Netflix has argued that the transaction would preserve theatrical releases and lower consumer costs through bundled offerings.

Netflix co-CEO Ted Sarandos said he remains confident the deal would win regulatory approval. He added that it would avoid job cuts in an industry already under pressure.