The war for the future of Warner Brothers continues, as Paramount Skydance announced a modified all-cash offer for the former movie studio on Monday. The offer includes an “irrevocable personal guarantee” from a major backer, Oracle billionaire Larry Ellison, to provide tens of billions of dollars in equity for the transaction. It’s the latest move by Ellison’s son David Ellison – the CEO of Paramount Skydance – to wrest the potential acquisition away from rival streaming giant Netflix.
“Larry Ellison has agreed to provide an irrevocable personal guarantee of $40.4 billion from the equity financing for the offering and any claim for damages against Paramount,” said a Paramount press release issued Monday. The proposed equity financing had already been included in Paramount’s offer, but the elder Ellison’s “personal guarantee” is new, the press release said.
The revised offer comes just a week after WBD’s board rejected Paramount’s initial offer, instead favoring an earlier deal with Netflix. That deal was announced on Dec. 5, outlining how the streamer would purchase the movie studio via a cash and stock option valued at $27.75 per WBD share and a total enterprise value of $82.7 billion.
Three days after announcing the Netflix deal, Paramount launched a hostile bid valued at $108.4 billion, offering $30 per share. WBD’s board rejected the offer, calling it “illusory” and saying Paramount had misled shareholders about financing the proposed deal. At the time of the rejection, the board noted that the deal with Netflix was “a binding agreement with enforceable commitments, without the need for equity financing or robust debt commitments.”
Now, Paramount’s amended offer was designed to “address concerns expressed by WBD regarding Paramount’s superior offer,” Paramount said. In October, CNBC reported that before the Netflix deal, WBD had previously rejected three different buyout offers from Paramount.
“Paramount has repeatedly demonstrated its commitment to acquiring WBD,” David Ellison, CEO of Paramount Skydance, said in Monday’s press release. “Our all-cash funded offering of $30 per share occurred on December 4 and continues to be the superior option for maximizing 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 film production and greater choice for consumers.”
He added, “We expect the WBD Board of Directors to take the necessary steps to secure this value-add transaction and preserve and strengthen an iconic Hollywood treasure for the future.” »
TechCrunch contacted Warner Bros. Discovery for comments.
