Paramount sweetens its WBD bid with a $40 billion guarantee from Larry Ellison — but doesn’t increase the price

• Paramount revised its Warner Bros. Discovery bid, adding a $40.4 billion guarantee by Larry Ellison.
• Paramount didn’t increase its offer of $30 per share, though.
• Paramount also increased its termination fee to $5.8 billion, matching Netflix’s proposal.

Paramount Skydance on Monday revised its hostile bid for Warner Bros. Discovery, without increasing the price, after WBD’s board affirmed its backing of rival Netflix’s offer.

In Paramount’s new offer, the company said Larry Ellison, one of the richest people in the world and father to Paramount CEO David Ellison, agreed to provide an irrevocable personal guarantee of $40.4 billion of the equity financing for the offer. Paramount said Ellison has also agreed not to revoke the long-standing Ellison family trust.

This change by Paramount directly responds to objections raised by the WBD in response to its last offer. Paramount had previously said its bid was fully backstopped by the elder Ellison, but the WBD board objected to the bid, saying it relied “on an unknown and opaque revocable trust” whose assets or liabilities were subject to change.

In its new bid, Paramount also said it would match the termination fee Netflix offered, upping its fee to $5.8 billion from $5 billion if the deal doesn’t go through.

“Paramount has repeatedly demonstrated its commitment to acquiring WBD,” David Ellison wrote. “Our $30 per share, fully financed all-cash offer was on December 4th, and continues to be, the superior option to maximize value for WBD shareholders.”

In the new bid, Paramount stuck with its $30 per share price for the whole company. Netflix’s bid is $27.75 per share for only WBD’s studios and streaming business.

Warner Bros. and Netflix didn’t immediately respond to requests for comment.