Larry Ellison pledges $40bn guarantee on Paramount Warner bid

Oracle co-founder Larry Ellison has pledged a personal $40.4bn financing guarantee for Paramount Skydance's bid to buy Warner Bros Discovery, ‌according to a filing lodged on Monday.

Paramount said ‍the new terms would not alter its $30-per-share all-cash offer valuing its target at $108bn. WBD last week rejected the hostile offer as inadequate and questioned its financing as it reaffirmed support for Netflix’s rival $83bn proposal.

“None of these concerns, nor the demand for a personal guarantee, were raised by WBD or its advisors to Paramount in the 12-week period leading up to WBD agreeing to the inferior transaction with Netflix,” Paramount said in its filing document.

Paramount said Ellison, father of Paramount chief executive David Ellison, has also agreed not to revoke the Ellison family trust or adversely transfer its assets during a pending transaction.

In a letter last week to shareholders, WBD accused Paramount of having “consistently misled” investors by claiming its bid has a “full backstop” – a safety net to ensure it has sufficient funds – from the billionaire Ellison family.

“Following a careful evaluation of Paramount’s recently launched tender offer, the Board concluded that the offer’s value is inadequate, with significant risks and costs imposed on our shareholders,” Samuel A Di Piazza Jr, chairman of WBD’s board, said in a statement.

“This offer once again fails to address key concerns that we have consistently communicated to Paramount throughout our extensive engagement and review of their six previous proposals."

“We are confident that our merger with Netflix represents superior, more certain value for our shareholders and we look forward to delivering on the compelling benefits of our combination.”

Reporting by Frank Prenesti for Sharecast.com