NEW YORK — The battle for the future of Hollywood reached a fever pitch Wednesday as Warner Bros. Discovery (WBD) issued a scathing rejection of Paramount Skydance’s $108.4 billion hostile takeover bid. In a move that shifts the focus from corporate balance sheets to personal legacies, the WBD board demanded that Oracle co-founder Larry Ellison provide a “personal guarantee” and sign on the “dotted line” himself, questioning the reliability of the family trust currently backstopping the offer.
The rejection marks a pivotal moment in what has become a three-way tug-of-war between the legacy studio, the tech-giant-backed Paramount Skydance (PSKY), and the streaming titan Netflix. While Paramount’s $30-per-share all-cash offer significantly outpaces Netflix’s $27.75-per-share cash-and-stock deal on paper, WBD leadership dismissed the Ellison-led proposal as “illusory” and fraught with “gaps, loopholes, and limitations.”
The “Personal Guarantee” Ultimatum
At the heart of the dispute is the mechanism of the financing. Paramount’s bid relies on a massive $40.7 billion equity commitment, largely supported by the Lawrence J. Ellison Revocable Trust. Warner Bros. Discovery’s board, however, remains unconvinced that a revocable trust offers the necessary legal certainty for a deal of this magnitude.
In a detailed 1,400-word letter to shareholders, the board argued that a revocable trust can be amended or dissolved at the grantor’s whim, providing no secured commitment from a controlling shareholder. “A revocable trust is no replacement for a secured commitment,” the board wrote. “Despite having been told repeatedly how important a full and unconditional financing commitment was… the Ellison family has chosen not to backstop the PSKY offer.”
WBD is essentially calling Larry Ellison’s bluff: if the Oracle billionaire, whose net worth currently hovers around $243 billion, is truly committed to the deal, he must legally bind his personal assets to the transaction rather than hiding behind a shielded trust structure.
Comparing the Bids: Netflix vs. Paramount
The board’s preference for Netflix, despite the lower headline price, underscores a “flight to quality” in terms of deal certainty. The Netflix agreement, valued at an enterprise value of $82.7 billion, is described by WBD as “clean” and backed by an investment-grade balance sheet from a company with a $400 billion market cap.
| Feature | Netflix Offer | Paramount Skydance (Hostile) |
| Offer Price | $27.75 per share (Cash/Stock) | $30.00 per share (All-Cash) |
| Total Equity Value | ~$72 Billion | ~$108.4 Billion |
| Assets Included | Film/TV Studios, HBO, Max | Entire WBD (Studios + Cable/CNN) |
| Financing Backstop | Public Market Cap / Investment Grade | Revocable Trust / Sovereign Wealth |
| Regulatory Path | High (Streaming Dominance) | High (Studio Consolidation) |
Furthermore, the Netflix deal involves a strategic spin-off. Under that plan, WBD would separate its linear cable networks—including CNN, TNT, and Discovery—into a new publicly traded entity called “Discovery Global,” while Netflix absorbs the premium studio and streaming assets. Paramount, conversely, intends to keep the company whole, a move WBD argues would leave shareholders with a “heavily indebted sub-scale linear business.”
The “Project Athena” Shadow and Synergy Skepticism
Adding fuel to the fire is WBD’s dismissal of Paramount’s projected $9 billion in cost synergies. WBD directors called these targets “operationally ambitious” and potentially “harmful to the creative industry.” There are deep fears within the WBD camp that Paramount’s strategy—nicknamed “Project Athena”—would result in draconian cuts that would “make Hollywood weaker, not stronger.”
Netflix has attempted to soothe these fears by committing to maintain traditional theatrical windows for WBD films, a significant concession for a company that once championed a “digital-first” release model.
The Trump and Regulatory Wild Card
The bidding war is not just a financial conflict; it is a political one. Paramount CEO David Ellison (Larry’s son) and chief legal officer Makan Delrahim have been aggressively lobbying in Washington, meeting with representatives from the White House and figures like Senator Ted Cruz.
The Ellisons have leaned into their relationship with President Donald Trump, suggesting that their deal would face a smoother regulatory path. President Trump has already weighed in, stating that the Netflix deal “could be a problem” due to its potential market dominance and has explicitly called for CNN to have “new owners” as part of any sale—a condition that Paramount’s bid fulfills but Netflix’s does not.
However, the departure of Affinity Partners, the investment firm run by the President’s son-in-law Jared Kushner, has raised eyebrows. Affinity withdrew from the Paramount consortium this week, stating that the “dynamics of the investment have changed significantly.”
Shareholder Stalemate
Despite the board’s recommendation, the final decision rests with the shareholders. Major investors are currently divided. While the WBD board is firm on the Netflix path, some high-profile investors, including money manager Mario Gabelli, have indicated they are likely to tender their shares to Paramount, enticed by the $30 all-cash certainty and the belief that a Paramount-WBD merger would face fewer hurdles in a Trump-led regulatory environment.
“In reality, it is all quite simple,” Paramount countered in a statement. “$30 in cash fully backstopped by a well-capitalized trust of one of the most well-known founders in the world.”
Paramount has until January 8, 2026, to convince enough shareholders to ignore the board’s advice. Until then, the industry remains in a state of suspended animation, waiting to see if Larry Ellison will finally pick up the pen and provide the guarantee WBD demands.