Larry Ellison's son invests $17B in Paramount-Warner Bros. merger
What's the story
David Ellison, the son of Oracle co-founder Larry Ellison, has invested some $17 billion to help Paramount acquire Warner Bros. Discovery Inc. The investment was made through a stock offering where the Ellisons and their family bought around 1.4 billion shares at $12 each, according to public filings. The deal was finalized on October 6 and is one of the largest media mergers ever seen.
Additional funding
Ellisons's previous investment
The recent investment by the Ellisons comes in addition to the nearly $8 billion they and RedBird Capital Partners had invested last year to gain control of Paramount.
The Ellisons control the company through their ownership of voting shares.
While it's unclear where the funds for this latest investment came from, Larry had revealed on September 25 that he had pledged 67 million Oracle shares over the past year as collateral for personal loans.
Acquisition details
Details of the Warner acquisition and Skydance merger
The $110 billion Warner Bros. acquisition was backed by a $47 billion equity investment.
Three Middle Eastern sovereign wealth funds were expected to contribute $24 billion, while RedBird Capital Partners and Shinsegae Group, a South Korean retailer, invested $4 billion and $1 billion respectively.
The newly merged company is now called Skydance Corp.
Market reaction
Skydance shares dip post-merger
Since the merger was completed, Skydance shares have witnessed a nearly 9% drop. The market's reaction to the merger is still unfolding, but it shows how major corporate deals can impact stock performance.
Despite this, the Warner Bros. acquisition remains one of the biggest media mergers in history, uniting two storied film studios, dozens of TV channels and two major subscription streaming services under one roof.