Paramount Skydance (PSKY) CEO David Ellison on Wednesday sent a letter to the shareholders of Warner Bros. Discovery (WBD) in his latest attempt to convince them his $108B total buyout proposal is superior to Netflix’s (NFLX) $72B deal for just streaming and studio assets.
Paramount claims, among other things, that in Netflix’s offer, the cash component is about $18B lower in aggregate than theirs, and WBD shareholders will be exposed to Netflix stock’s downside risk.
Ellison highlighted in the letter that the $6B synergy estimate from Paramount buying Warner Bros. does not rely on cuts to content budgets at studios and that they intend to continue running both separately post-close.
Ellison also notably said Paramount’s bid will be financed by $41B of new equity backstopped by the Ellison family and RedBird Capital and $54B of debt commitments from Bank of America, Citi, and Apollo (APO).
Several media outlets had reported that Ellison’s bid would be backed by Arab sovereign wealth funds, including the president’s son-in-law’s private equity firm, which is backed by the Saudis.
Members of Congress earlier today raised national security concerns over reports about Paramount’s bid and notified Warner Bros. CEO David Zaslav that the company must file with the CFIUS if they accept a foreign-backed bid.
During a White House event, President Donald Trump said that any deal for Warner Bros. should also include a sale of CNN and that he “will be involved” with the transaction.