Paramount shores up WBD bid with ‘irrevocable’ personal guarantee from Larry Ellison

Paramount has updated its hostile offer to buy Warner Bros Discovery (WBD), with the company introducing several new terms including an agreement that Larry Ellison will provide an “irrevocable personal guarantee” for a portion of the equity financing.

Larry Ellison

Oracle PR/Hartmann Studios/WikiMedia

The company on Monday restated its offer to buy the entirety of WBD for US$30 per share in a deal worth US$108.4bn, as it looks to unseat Netflix’s definitive agreement to buy WBD’s studio and streaming assets for US$82.7bn, including debt.

However, the David Ellison-led company’s revised bid claims to address several of the primary concerns raised by WBD’s board of directors in prior back-and-forth negotiations about the offer.

Paramount’s most recent proposal included US$40.65bn of equity financing that it said was personally backstopped by the Ellison family, but WBD denied that was the case and claimed there was “no Ellison family commitment of any kind.”

In its revised offer, Paramount said Larry Ellison, the world’s second-richest person and a co-founder of software giant Oracle, has “agreed to provide an irrevocable personal guarantee of [US]$40.4bn of the equity financing for the offer and any damages claims against Paramount.” As part of that guarantee, Paramount said Larry Ellison had agreed “not to revoke the Ellison family trust or adversely transfer its assets” while the deal is pending.

In addition, Paramount increased its regulatory termination fee (the fee it would be required to pay WBD if the deal does not go through) from US$5bn to US$5.8bn, matching the break-up fee included in Netflix’s deal.

Paramount claimed WBD did not engage with its most recent US$108.4bn offer, prompting it to go directly to WBD shareholders with its hostile bid three days after WBD announced that Netflix had emerged victorious in the auction process. Paramount had initially set a deadline of January 8, 2026 for WBD shareholders to tender their shares. It has now extended the expiration date until January 21, 2026.

The revised offer from Paramount comes after WBD last week gave a scathing rejection of its prior offer. In its reply, the WBD board said Paramount made “illusory” and misleading claims about the credibility of the financing plan and claimed Paramount’s proposed cost-savings targets would “make Hollywood weaker, not stronger.”

While Paramount has made a lot of noise with its hostile takeover attempt, WBD and Netflix execs appear to be forging ahead with their goal of uniting the two businesses. Last week, WBD president and CEO David Zaslav gave Netflix co-CEOs Ted Sarandos and Greg Peters a tour of the WBD studio lot in Burbank. For its part, Netflix has retained that it is confident its existing deal will ultimately hold, and pass muster with regulators in the US and Europe.

One of the wild cards is the American regulatory approval process, which could see US president Donald Trump playing a role. Earlier this month, Trump said the deal “could be a problem” and claimed he would be “involved” in whether the deal ultimately receives regulatory approval.

Paramount has previously hinted that it may be prepared to increase its bid, as it looks to wrest control of WBD away from Netflix.

“Paramount has repeatedly demonstrated its commitment to acquiring WBD. Our $30 per share, fully financed all-cash offer was on December 4th, and continues to be, the superior option to maximize value for WBD shareholders,” said David Ellison, who serves as chairman and CEO of Paramount.

“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.”

WBD responded later on Monday, saying it would review the amended offer and advising its stockholders “not to take any action at this time.” It added: “The Board is not modifying its recommendation with respect to the Netflix Merger Agreement.”