Paramount Skydance Bolsters WBD Bid with $40.4 Billion Guarantee from Larry Ellison

Paramount Skydance has significantly reinforced its hostile takeover proposal for Warner Bros. Discovery (WBD) by securing an irrevocable personal financial guarantee from Oracle co-founder Larry Ellison, amounting to $40.4 billion of the required equity financing. This strategic maneuver, announced on Monday, December 22, 2025, directly confronts the WBD Board's prior reservations concerning the dependability of the Ellison family trust's financial commitment, which had been a central objection to the initial offer.

The revised agreement stipulates that Ellison will not revoke the family trust or transfer its assets while the acquisition process is pending, providing a robust financial backstop that addresses the board's previous concerns about the revocable nature of the initial commitment. Paramount Skydance continues to press its all-cash bid, valuing WBD at an enterprise value of approximately $108.4 billion, or $30 per share, with the intention of acquiring the entire company and assuming all associated assets and liabilities.

This offer contrasts sharply with the competing definitive agreement WBD accepted on December 5, 2025, with Netflix. The Netflix deal values only the studios and streaming division at an enterprise value of about $82.7 billion, contingent upon a planned spin-off of the Global Linear Networks division, expected in the third quarter of 2026. To align further with the competitor's terms, Paramount Skydance elevated its regulatory reverse termination fee to $5.8 billion, matching the commitment made by Netflix.

This corporate contest unfolds against a complex regulatory backdrop, particularly concerning the Netflix proposal. Senior White House officials under President Donald Trump have reportedly expressed skepticism regarding the Netflix acquisition, citing concerns that it would grant the streaming giant too much power over Hollywood and stifle competition, potentially triggering a lengthy antitrust investigation. David Ellison, Chairman and CEO of Paramount and son of Larry Ellison, has cited his close relationship with President Trump as a potential advantage for his bid.

Paramount Skydance has extended the tender offer deadline for WBD shareholders to January 21, 2026, following the WBD Board’s formal recommendation on Wednesday, December 17, 2025, for shareholders to reject the Paramount offer and approve the Netflix merger. Despite the board's stance, key shareholders like Mario Gabelli have indicated a propensity to tender their shares to Paramount Skydance, suggesting a division among investors regarding the superior value proposition. Paramount maintains its all-cash offer provides greater certainty and value maximization compared to the Netflix deal, which involves a stock component and the retention of Discovery Global stub equity.

The introduction of Larry Ellison's personal guarantee is viewed as a decisive attempt to neutralize the WBD board's primary financial objection, even as some analysts suggest the revision may only offer marginal impact given the board cited other reasons for preferring Netflix. The ultimate decision rests with WBD shareholders as they weigh the certainty of Paramount's all-cash, full-company acquisition against the partial acquisition structure and regulatory hurdles facing the Netflix proposal.