Jared Kushner Withdraws Support from Paramount’s Warner Bros. Bid

A private equity firm owned by Jared Kushner, who is also the son-in-law of former President Donald Trump, has withdrawn its financial backing from Paramount’s hostile takeover bid for Warner Bros. Discovery. This announcement came on December 9, 2023, shortly after Warner agreed to be acquired by Netflix. Paramount’s bid aims to bypass Warner’s management and appeal directly to its shareholders with a higher offer of $30 per share, compared to Netflix’s $27.75.

Warner Bros. Discovery, recognized as one of the “big five” Hollywood studios, owns a diverse portfolio that includes Warner Bros. Pictures, HBO, the DC Comics universe, and the Harry Potter franchise. Experts suggest that the acquisition of Warner could significantly enhance the capabilities of the winning company, potentially reshaping the competitive landscape of streaming services.

Paramount’s decision to launch a rival bid was driven by frustrations over Warner’s management, which reportedly “never engaged meaningfully” with earlier offers. The company publicly disclosed the new bid details and provided Warner shareholders with the option to tender their shares at the set price, supporting Paramount’s acquisition efforts. Unlike Netflix, Paramount’s offer includes the entirety of Warner’s portfolio, such as cable networks like CNN, which Netflix has chosen to exclude.

Paramount’s $108 billion bid follows Netflix’s announcement of a $72 billion deal with Warner Bros. This competitive scenario has even drawn comments from President Trump, who expressed concerns that the Netflix acquisition might create regulatory challenges due to the size of the combined market share. In its appeal to shareholders, Paramount asserted that its offer might face less scrutiny under the Trump administration.

Despite the potential advantages of Kushner’s involvement, Affinity Partners, the firm he leads, has stated that it will no longer support the bid. In a statement, the firm indicated that “the dynamics of the investment have changed significantly since we initially became involved in October.” Nonetheless, Affinity Partners continues to recognize “a strong strategic rationale” for Paramount’s offer.

Paramount’s bid remains financially backed by sovereign wealth funds from three Persian Gulf nations, widely reported to be Saudi Arabia, Abu Dhabi, and Qatar. The company, which also owns CBS, MTV, and the streaming service Paramount+, is now led by David Ellison, the son of major Trump supporter Larry Ellison. Recently, Trump criticized the Ellisons regarding their treatment by CBS News’s 60 Minutes, stating, “If they are friends, I’d hate to see my enemies!”

Warner Bros. is currently evaluating Paramount’s bid and is expected to announce soon whether it presents a more favorable deal than the one offered by Netflix. With significant implications for the future of streaming services, this bidding war highlights the evolving landscape of the entertainment industry and the intense competition among major players.