Members of the U.S. Congress have raised national security concerns after media outlets reported that Paramount Skydance’s bid (PSKY) for Warner Bros. Discovery (WBD) is expected to be backed by Arab sovereign funds as well as the president’s son-in-law Jared Kushner’s private equity firm, which is funded by the Saudi Public Investment Fund.
Congress members said that foreign investors, by virtue of their financial position, could influence business decisions in the future that might affect editorial independence, content moderation, distribution priorities, or the private data of Americans.
In a letter addressing WBD CEO David Zaslav, the members said that the company must file a notice with the Committee on Foreign Investment in the United States if it proceeds with any deal involving foreign sovereign or state-linked investors and submit the transaction for a full national security review.
“Any transaction providing foreign investors with governance rights, access to non-public data, or indirect influence over content distribution creates vulnerabilities that foreign governments could exploit,” the members said in the letter. “Even absent overt control, such influence can present a national-security threat when foreign state-linked entities have strategic interests inconsistent with those of the United States.”
“Should Warner pursue negotiations with Paramount Skydance or any other buyer financed by foreign sovereign investors, the company will file a voluntary notice with CFIUS prior to executingany binding agreement,” the letter said.
Warner Bros. is currently not pursuing Paramount’s latest $108B offer but rather sticking to Netflix’s $72B deal for streaming and studio assets.