A private equity firm owned by Jared Kushner, President Donald Trump’s son-in-law, has confirmed that it will no longer support Paramount's hostile acquisition bid for Warner Bros. Discovery. This announcement came on a Tuesday amidst ongoing developments in the competitive landscape of media acquisitions.
In early December, shortly after Warner agreed to be acquired by Netflix, Paramount launched a competing bid aimed at appealing directly to Warner's shareholders. The bid offered $30 per Warner share, contrasting with Netflix’s initial bid of $27.75. Warner Bros. Discovery, one of Hollywood's "big five" studios, encompasses a vast portfolio including Warner Bros. Pictures, HBO, the DC Comics universe, and the Harry Potter franchise. Experts believe that the successful acquisition of Warner could significantly enhance the winning company's position in the evolving streaming wars, potentially accelerating Netflix's lead or establishing a formidable rival in Paramount.
Paramount's decision to bypass Warner's management stemmed from their frustrations over a perceived lack of meaningful engagement from Warner's top executives regarding earlier offers. By making its new bid public, Paramount provided Warner’s shareholders the option to tender their shares, allowing them to sell directly at a guaranteed price as part of its acquisition strategy. Notably, Paramount aimed to acquire Warner’s entire portfolio, which includes several cable networks like CNN—an element that Netflix chose to exclude in its bid.
In an attempt to influence the shareholders, Paramount argued that its offer would likely face less regulatory scrutiny under the current Trump administration, referencing concerns voiced by President Trump about the potential market dominance that a Warner and Netflix merger could create.
Kushner's Affinity Partners initially provided financial backing for Paramount's bid. However, their withdrawal has removed a strategic advantage that could sway Trump’s support to Paramount. The exact amount that Affinity Partners was contributing to the acquisition bid was not disclosed in Paramount's recent SEC filings. Following their decision to step back from the bid, the firm issued a statement noting, “With two strong competitors vying to secure the future of this unique American asset, Affinity has decided no longer to pursue the opportunity. The dynamics of the investment have changed significantly since we initially became involved in October.”
Despite losing Kushner’s support, Paramount's bid remains bolstered by wealth funds from three Persian Gulf governments, widely reported as Saudi Arabia, Abu Dhabi, and Qatar. Paramount, which owns significant properties including CBS, MTV, and the streaming service Paramount+, is now under the leadership of David Ellison, who is the son of a notable Trump donor. However, Donald Trump has expressed recent criticism of the Ellisons, particularly regarding their treatment of him by CBS News’ “60 Minutes.” In his remarks on Truth Social, Trump stated, “If they are friends, I’d hate to see my enemies!”
Currently, Warner Bros. Discovery is evaluating Paramount's offer and is anticipated to inform shareholders shortly whether it presents a more favorable deal than the one offered by Netflix.
