Paramount Secures $24 Billion for Warner Bros. Acquisition

Paramount Skydance, under David Ellison’s leadership, has reportedly secured close to $24 billion from three Gulf Coast investment funds to facilitate the acquisition of Warner Bros. Discovery.

According to an anonymous source cited by The Wall Street Journal, Saudi Arabia’s Public Investment Fund is set to contribute around $10 billion. Qatar Investment Authority and Abu Dhabi’s Rimad Holding have also entered investment agreements with Paramount.

This funding aims to help cover the significant $81 billion needed for the transaction involving Paramount’s CEO, Ellison, and his father, Larry Ellison, a billionaire and noted supporter of President Trump.

Interestingly, Ellison had previously indicated his willingness to back the deal, even without external support. Additionally, Jerry Cardinale’s private equity firm, Redbird Capital, is also bolstering the acquisition.

The involvement of Gulf funds comes amid ongoing tensions in the Middle East, particularly related to the US-Israel conflict with Iran. Attacks in the region—sometimes impacting major energy facilities in Qatar and Saudi Arabia—could disrupt global energy markets.

At the same time, Paramount’s proposed merger with WBD, which includes iconic brands like HBO, CNN, and CBS, is currently undergoing regulatory scrutiny in Europe. Experts suggest that it might face more hurdles there than in the United States.

Despite this, Paramount executives have reportedly advised employees to brace for a potential closing of the deal by the end of July.

Paramount has chosen not to comment on the situation.

Following competitive bidding, Paramount emerged victorious in acquiring WBD in February. Some have speculated that the Ellison family’s financial backing could lead to favorable regulatory approvals for the acquisition.

Derek Ricefield, a former CBS News and McKinsey media executive, noted that the Gulf’s financial involvement “could complicate things a little bit.” But he also pointed out that these investments are in non-voting shares, easing some regulatory concerns.

Regulatory challenges in the U.S. are likely to be addressed by CFIUS and the Federal Communications Commission (FCC).

Ricefield expressed optimism about CFIUS approval due to the lack of voting rights for Gulf investors in the new Paramount-WBD entity. He also mentioned that the individual stakes do not exceed the 25% foreign investor threshold, reducing the likelihood of FCC intervention.

Paramount’s initial offer for WBD had backing from Tencent and private equity firm Affinity Partners, associated with Jared Kushner, but these parties are no longer involved.

The total financial commitment for the deal, factoring in existing debts, rises to about $110 billion, with major financial support from institutions like Bank of America and Citigroup. Paramount’s bid included a hefty $2.8 billion fee to terminate its agreement with Netflix and a “ticking fee” totaling $650 million for delays.

A recent SEC filing revealed that Paramount’s offer included $24 billion from Middle Eastern investors.

Interestingly, there was a previous denial in November regarding collaboration with Middle Eastern sovereign funds, which the company labeled as inaccurate.

Meanwhile, the Justice Department’s antitrust division has expressed doubt about the deal being approved in a timely manner, possibly influenced by the Ellison family’s ties to President Trump. Trump himself has previously praised the Ellisons, highlighting their contributions to CBS News after its merger with Paramount Skydance.

Warner Bros. has scheduled a special stockholder meeting for April 23 to vote on the merger.