Paramount Skydance (PSKY) has included an “irrevocable personal guarantee” from Oracle founder and billionaire Larry Ellison in its $30 per share offer to buy Warner Bros. Discovery (WBD), after the HBO owner raised concerns about the David Ellison-led media company’s financing capabilities for the deal.
“Larry Ellison has agreed to provide an irrevocable personal guarantee of $40.4 billion of the equity financing for the offer and any damages claims against Paramount,” the company said in a statement on Monday.
The news comes after Warner Bros. said in an SEC filing last week that the Ellisons’ equity is supported by “an unknown and opaque revocable trust” and the documents Paramount provided had “gaps, loopholes, and limitations.”
Paramount said Larry Ellison has agreed not to revoke the Ellison family trust or adversely transfer its assets during the pendency of the transaction. It has also raised its reverse termination fee from $5B to $5.8B.
During the 12-week period of discussions with Warner Bros., Paramount claims the David Zaslav-run company did not bring up the issue of a personal guarantee from Larry Ellison.
Paramount also highlighted that the offer to buy Warner Bros. is conditioned, among other things, on WBD continuing to own 100% of its TV networks business.
Netflix (NFLX) is currently the front-runner to buy the streaming and studio assets of Warner Bros. in a $72B deal, excluding debt.