Paramount’s Ellison Unsuccessfully Courts Zaslav for Warner Bros Acquisition

David Ellison’s ambitious campaign to acquire Warner Bros. Discovery (WBD) reached a pivotal moment recently. The Paramount Skydance CEO was resolute in his pursuit, but ultimately fell short as Netflix clinched a deal to acquire the company.

Key Moves in the Acquisition Bid

Ellison engaged in extensive discussions with David Zaslav, WBD’s president and CEO, trying to sway him in favor of a merger with Paramount. He hosted dinner meetings, including one with his father, Larry Ellison, where discussions about potential collaborations took place. Despite this effort, the Warner Bros. board continued to reject Paramount’s proposals.

Details of the Offers

Paramount’s initial offer included an all-cash bid of $30 per share, totaling an equity value of $77.9 billion. The proposal highlighted Paramount’s advantages over Netflix, claiming higher cash value and a shorter regulatory approval timeline. However, the Warner Bros. Board insisted on pursuing a deal with Netflix, which was announced on December 5 with an equity value of $72 billion.

Over a span of 12 weeks, Paramount made six proposals to WBD, culminating in the December 4 offer. Ellison even suggested Zaslav take on a co-CEO role should the merger succeed.

Transition to Hostile Takeover

Following the deal with Netflix, Ellison pivoted to a hostile takeover strategy. “Our proposal is superior on every front,” he remarked in a call with investors, emphasizing shareholder choice and transparency. Paramount Skydance filed its intention to go directly to WBD’s shareholders, criticizing WBD’s board for overlooking the benefits of its all-cash offer.

Regulatory and Financial Backing

The acquisition attempt saw backing from prominent investors, such as the Ellison family and Middle Eastern sovereign wealth funds, which were prepared to provide significant financing. Notably, Tencent, a prior financial partner, exited the deal.

Timeline of Events

This battle for Warner Bros. highlights the competitive landscape within the entertainment industry and the lengths to which companies will go to secure advantageous acquisitions. As Paramount Skydance moves forward with its hostile bid, the outcome remains to be seen.