Paramount Sweetens Warner Bid With Ellison’s $40.4 Billion Guarantee, but Key Holder Says It Still Falls Short

Overview

• Netflix refinanced part of its $59 billion bridge loan, adding a $5 billion revolver and two $10 billion deferred-draw term loans, leaving about $34 billion to syndicate.
• Paramount reaffirmed its $108.4 billion cash offer, secured an irrevocable $40.4 billion personal guarantee from Larry Ellison, and received his commitment not to revoke the family trust.
• Paramount raised its reverse breakup fee to $5.8 billion and extended its offer deadline to January 21, while maintaining a price of $30 per Warner share.
• Warner’s board urged shareholders to reject Paramount’s proposal and continue with the Netflix agreement, calling the rival bid inferior and riskier on financing.
• Harris Oakmark, a top-five Warner shareholder, said Paramount’s revisions were necessary but insufficient and suggested stronger terms would be required to win support, as both bids face tough antitrust reviews in the U.S. and Europe.