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David Ellison Sweetens Paramount’s WBD Offer With a Washington Playbook

By raising his offer and mobilizing allies in Washington, David Ellison is turning the Warner Bros. Discovery fight into a regulatory showdown with Netflix.

David Ellison is taking his bid for Warner Bros. Discovery into Washington, pairing a higher cash offer with a political strategy aimed at outflanking Netflix in what could become the defining media acquisition of the decade. Paramount Skydance, the company Ellison leads after his Skydance Media acquired Paramount last year, raised its offer yesterday (Feb. 24) to $31 per share, up from $30, to buy all of WBD. WBD’s board said the revised bid could lead to a “company superior proposal,” language in its merger agreement with Netflix that allows the company to keep negotiating without formally switching sides. If WBD ultimately chooses Paramount, Netflix would have four business days to match or improve its bid.

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Ellison’s latest move is focused on making the deal more likely to close, not just more expensive. Paramount has agreed to pay WBD a $7 billion reverse breakup fee if regulators block the merger. Both Paramount’s and Netflix’s proposals are likely to face antitrust scrutiny, but Ellison is arguing that Paramount’s deal would be easier to get approved.

Paramount also added a $0.25-per-share quarterly “ticking fee” starting in September, giving WBD shareholders extra cash if the deal drags on. And it agreed to cover the $2.8 billion breakup fee WBD would owe Netflix if it walks away.

At the same time, Ellison is building a Washington team designed to make Netflix’s bid look like the tougher one to clear. Paramount recently hired Rene Augustine as senior vice president of global public policy. A former White House lawyer under President Donald Trump and a Justice Department antitrust official from 2019 to 2021, she now reports to Makan Delrahim, Paramount’s chief legal officer and the former head of the DOJ’s antitrust division.

Ellison has also made his case directly to lawmakers. In February, he sent a letter to Senator Cory Booker, a Democrat from New Jersey, after Booker requested written testimony when Ellison declined to appear at the Senate antitrust hearing on the Netflix-WBD deal. In the letter, Ellison challenged Netflix’s effort to define the market broadly—by including free platforms like YouTube—and urged regulators to focus on subscription streaming, where Paramount argues Netflix holds outsized power. In short, Ellison wants regulators to view the merger in a narrower market where Netflix looks more dominant.

Paramount has framed recent regulatory developments as signs of progress. The company said the 10-day waiting period tied to its WBD bid had expired, calling it a milestone and arguing that it had cleared an antitrust hurdle. Netflix’s chief legal officer, David Hyman, publicly pushed back, saying Paramount was overstating a routine procedural step and remained far from securing the approvals needed to close.

Netflix, for its part, recently hired antitrust lobbyist Seth Bloom, signaling that it, too, is preparing for a regulatory and political battle.

Regulatory pressure on Netflix’s bid escalated today after 11 Republican state attorneys general urged the Justice Department to thoroughly probe the Netflix-WBD deal, while California Attorney General Rob Bonta is also reviewing both the Netflix and Paramount bids.

Ellison has also stepped more visibly into the political arena. He attended President Donald Trump’s State of the Union address this week, highlighting the Ellison family’s longstanding ties to Trump. Larry Ellison—David Ellison’s father and Oracle’s co-founder and chairman—hosted a Trump fundraiser in 2020 and has been one of the few major tech billionaires to publicly support him.

The third front is shareholders. In large mergers, activist investors can sway votes, shape public narratives and, in some cases, challenge board members directly.

Paramount has held talks with Matthew Halbower, founder of Pentwater Capital Management, WBD’s seventh-largest shareholder, about a possible seat on WBD’s board for Halbower if the battle turns into a proxy fight in which shareholders vote on rival slates of directors.

Ancora Holdings, another activist investor owning WBD shares, has also attacked the Netflix deal and urged WBD to engage more aggressively with Paramount, betting that pressure on the board could force either a sweeter Paramount offer or a stronger response from Netflix.

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