Larry Ellison Personally Guarantees $40.4B to Seal Paramount’s Warner Bros. Deal

• Larry Ellison personally guaranteed $40.4 billion in equity financing for Paramount Skydance’s $30-per-share all-cash offer to acquire Warner Bros. Discovery (WBD), valued at $108.4 billion, addressing prior board concerns about financing certainty.
• Paramount Skydance (PSKY) shares rose more than 7% to $13.98 and Warner Bros. Discovery (WBD) shares gained over 3% to an intraday high of $28.98, while Netflix (NFLX) shares fell 0.86% to $93.58.
• The renewed bid emphasizes full financing commitments from Ellison’s family trust, RedBird Capital, and Middle Eastern sovereign funds, positioning Paramount’s proposal as superior for Warner Bros. Discovery shareholders and stakeholders.

Shares of Paramount Skydance (PSKY) and Warner Bros. Discovery (WBD) advanced on Monday morning following Paramount’s announcement that Oracle (ORCL) co-founder and executive chairman Larry Ellison had committed to an irrevocable personal guarantee of $40.4 billion in equity financing for its proposed all-cash acquisition of Warner Bros. Discovery.

Paramount Skydance stock rose more than 7% in early trading to $13.98, while Warner Bros. Discovery shares climbed over 3%, reaching an intraday high of $28.98. In contrast, Netflix (NFLX) shares declined 0.86% to $93.58 amid the escalating competition.

The move addresses longstanding concerns from Warner Bros. Discovery’s board regarding the reliability of Paramount’s financing. In a securities filing, Paramount stated that Ellison had agreed to backstop the equity portion of the deal, which remains at $30 per share, valuing the entire company at $108.4 billion. The Ellison family trust, holding approximately 1.16 billion shares of Oracle common stock, serves as the foundation, with Ellison committing not to revoke the trust or adversely transfer assets while negotiations continue.

Paramount emphasized that this structure provides full certainty, countering prior criticisms from Warner Bros. Discovery that the financing relied on a revocable trust lacking sufficient guarantees. The board had rejected Paramount’s earlier proposals, favoring Netflix’s bid for Warner Bros. Discovery’s streaming and studios division, valued at around $82.7 billion. That deal would involve spinning off the global networks division into a separate entity called Discovery Global.

Paramount CEO David Ellison reiterated the bid’s merits in a press release, stating that the $30 per share all-cash offer maximizes value for Warner Bros. Discovery shareholders and positions the combined entity for greater content production, theatrical releases, and consumer choice. He highlighted the company’s commitment to investment and growth as a key advantage over alternatives.

The bidding process has featured multiple rounds, with Paramount submitting several unsolicited offers before launching a hostile tender. Financing includes commitments from RedBird Capital Partners and sovereign wealth funds from the Middle East, though some initial participants, such as Affinity Partners, withdrew. Debt financing is secured from major banks, including Bank of America (BAC), Citigroup (C), and Apollo Global Management (APO).

Warner Bros. Discovery, led by CEO David Zaslav, has faced scrutiny over its strategic direction amid industry consolidation. The company controls a vast library of intellectual property through Warner Bros. studios, HBO, and other assets, making it a prime target in the streaming landscape.

Paramount’s latest step intensifies the contest for control of these assets, underscoring the high stakes in media mergers as companies seek scale to compete in an evolving entertainment market. The outcome will depend on shareholder support and regulatory considerations, particularly antitrust implications for a combined Netflix-Warner Bros. Discovery entity, which could control a significant portion of U.S. streaming activity.

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