Warner Bros. Discovery’s board has unanimously rejected Paramount Skydance’s hostile takeover offer, declaring that David Ellison’s $108.4 billion all-cash bid poses significant risks and that the Ellison family has “consistently misled” shareholders about their financial backing. The decision marks a dramatic escalation in the battle for one of Hollywood’s oldest studios, with board chairman Samuel Di Piazza Jr. stating that choosing Netflix’s $82.7 billion deal over the Paramount offer was “not a hard choice.” The rejection sets up a potential confrontation with Paramount, which has indicated it will forge ahead with its $30 per share tender offer directly to shareholders. What’s behind the board’s rejection Warner Bros. Discovery’s board raised serious concerns about the financial structure underpinning Paramount’s bid. Despite Paramount’s claims that the transaction has a “full backstop” from the billionaire Ellison family, Warner Bros. Discovery said in a letter to shareholders that “it does not, and never has.” The core issue centers on the legal entity backing the bid: a revocable trust run by Oracle co-founder Larry Ellison. Warner Bros. Discovery argued that a revocable trust provides no replacement for a secured commitment by a controlling stockholder, noting that its assets and liabilities are not publicly disclosed and remain subject to change at any time. The board said it had repeatedly told Paramount about the importance of a full and unconditional financing commitment from the Ellison family. Beyond the financing structure, Warner Bros. Discovery questioned the creditworthiness of Paramount itself. The board noted that the bid relies on...
Published By: CineD - Yesterday