David Ellison put in a lot of effort to secure Warner Bros. Discovery. However, Ellison lost out to Netflix in spite of his intense efforts, and now he is using sticks instead of rewards: Paramount Skydance is making a hostile acquisition request for WBD, going straight to shareholders. Ellison went to great efforts to try to reach an agreement with Warner Bros. Discovery president and CEO David Zaslav, according to new information revealed in a Paramount SEC filing.
Ellison made every effort to pursue Zaslav, inviting him to dine with his father, Larry Ellison. In order to negotiate a possible sale, David Ellison visited with Zaslav at his Beverly Hills residence. Additionally, according to the statement, Larry Ellison met via videoconference with Zaslav and Warner Bros.’ former chairman and significant stakeholder John Malone to “discuss Paramount’s interest in a combination with Warner Bros.”
During Thanksgiving, David Ellison and his teams at Paramount Skydance collaborated with external legal and financial advisors to craft a more attractive proposal for acquiring WBD in its entirety. This culminated in an all-cash offer of $30 per share, representing an equity value of $77.9 billion. Ellison went so far as to propose that Zaslav take on a co-CEO and co-chairman position in a merged Paramount-Warner Bros. Discovery.
As per Paramount, Ellison had texted Zaslav on December 4, saying, “It would be the honor of a lifetime to be your partner and the owner of these iconic assets.”
However, every proposal made by Ellison was turned down by the WBD board. On Friday, December 5, the company revealed a deal with Netflix to sell Warner Bros. studios and HBO Max, which has an equity value of $72 billion.
After Paramount submitted an offer of $30/share to the WBD board, Ellison sent Zaslav the following message on December 4: “Just tried calling you about the new bid we have submitted. I have heard all your concerns and believe we have addressed them in our new proposal. Please give me a call back when you can to discuss in detail.”
Ellison communicated the following message to Zaslav yet again, “Daivd [sic], I appreciate you’re underwater today so I wanted to send you a quick text. Please note when you next meet as a board we wanted to offer you a package that addressed all of the issues you discussed we [sic] me. Those were 1 we wanted to offer complete certainty 2 strong cash value 3 speed to close. Please note importantly we did not include ‘best and final’ in our bid. Also please know despite the noise of the last 24 hours I have nothing but respect and admiration for you and the company. It would be the honor of a lifetime to be your partner and to be the owner of these iconic assets. If we have the privilege to work together you will see that my father and I are the people you had dinner with. We are always loyal and honorable to our partners and hope we have the opportunity to prove that to you. Best, David.”
News organisations, including Variety, started claiming that Warner Bros. and Netflix had reached an exclusivity deal at around 11 p.m. ET on December 4. In the words of Paramount, neither Zaslav nor any WBD spokesperson replied.
