On Monday, Paramount Skydance launched a staggering $108 billion takeover bid for Warner Bros Discovery, the entertainment giant that owns major Hollywood studios, CNN, HBO, and other media assets. The bid is spearheaded by David Ellison, the CEO of Paramount and son of tech billionaire Larry Ellison, a known supporter of Donald Trump and a significant Republican donor. This move follows a previous bidding war where Netflix emerged victorious over Paramount for a similar acquisition. However, President Trump recently announced his intention to involve his administration in reviewing the Netflix deal, suggesting that it could pose a problem due to Netflix’s dominance in the US streaming market.
What Paramount’s press release omitted is the involvement of Jared Kushner, Trump’s son-in-law, and three Arab monarchies—Saudi Arabia, Qatar, and the United Arab Emirates—in the funding of this bid. These details were only revealed in the paperwork filed with the Securities and Exchange Commission. The inclusion of Kushner and the Arab states, which have ongoing financial ventures with the Trump family business, adds a layer of complexity to the deal.
The Intricate Web of Influence and Financing
In an interview with CNBC, David Ellison argued that Paramount’s offer might face less regulatory scrutiny than Netflix’s due to its smaller size and favorable relations with the Trump administration. This relationship is further complicated by Kushner’s involvement, given his extensive foreign financial dealings, particularly with the three autocratic Arab states that have heavily invested in his private equity firm, Affinity Partners. As of March 2024, nearly 99% of the $3 billion managed by Kushner’s fund came from foreign sources.
After serving as a senior adviser in Trump’s first term, Kushner chose not to take an official role in the second administration, citing a desire to focus on his business and avoid conflicts of interest. Yet, he has re-emerged as an unofficial peace envoy, playing a pivotal role in brokering ceasefires and negotiations in international conflicts, including those involving Israel, Hamas, Russia, and Ukraine.
Potential Conflicts and Regulatory Challenges
Kushner’s role in the Paramount bid is controversial due to the potential for conflicts of interest and foreign influence. The involvement of sovereign wealth funds from Saudi Arabia, Qatar, and the UAE, which have pledged $24 billion towards the deal, raises national security concerns. This substantial financial backing could grant these entities a majority stake in the newly formed company, typically triggering a review by the Committee on Foreign Investment in the United States (CFIUS).
Paramount, however, insists that the foreign funds and Kushner’s firm have agreed to waive governance rights, including board appointments, suggesting no national security threat. Yet, CFIUS, comprising various government agencies, retains the authority to investigate the deal’s implications for foreign control over US media assets.
Political and Economic Implications
Several Democratic lawmakers, including Elizabeth Warren, have expressed concerns about Kushner’s involvement and the potential for undue foreign influence. Warren emphasized that US officials must assess the deal based on legal and factual grounds rather than political favoritism. Meanwhile, Kushner is also involved in another significant foreign deal: a $55 billion agreement with the Saudi sovereign wealth fund to acquire Electronic Arts, a leading US video game publisher. This deal aligns with Saudi Arabia’s strategy of acquiring global sports assets and is also subject to CFIUS review.
“US officials must judge the deal based on the law and facts, not who sucked up the most to Donald Trump.” — Elizabeth Warren
The Broader Context of Media Influence
The Paramount bid for Warner Bros Discovery also appeals to Trump’s transactional interests. If successful, it could lead to a CNN network more aligned with Trump’s views, particularly ahead of crucial midterm elections. Trump has expressed a preference for Paramount, where the Ellison family holds significant control, to acquire Warner Bros, especially if it results in a more Trump-friendly CNN.
Recent reports indicate that Larry Ellison has discussed potential changes at CNN, including the dismissal of hosts critical of Trump. The Ellisons have already demonstrated deference to Trump by making significant changes at CBS, another Paramount property, including appointing Bari Weiss, a critic of “woke culture,” as editor-in-chief of CBS News.
For Trump, a successful Paramount takeover of Warner Bros could mean not only that his son-in-law and Arab allies play a crucial role in the deal but also that CNN’s parent company is under a more sympathetic ownership. This scenario presents a potential win for Trump but raises serious concerns about the implications for democracy and the rule of law.
