Paramount‘s beleaguered stock jumped nearly 11% Tuesday after news of deep-pocketed Middle East backers joining its Warner Bros. Discovery takeover.
The shares, which had fallen 20% in 2026 heading into Tuesday’s trading, finished at $10.90 on more than three times their normal trading volume.
Several regulatory agencies have approved Paramount’s pending $110 billion deal for WBD. The companies say it will close by the end of September. While Larry Ellison, co-founder of Oracle and one of the world’s richest people, is a principal backer of the Paramount-WBD deal, the market appeared to be relieved that he and Paramount are spreading some risk around along with the equity. Another plus for investors: the company’s issuing of free warrants entitling certain stockholders to acquire stock at the syndication price. The warrants will eventually be listed on the Nasdaq, trading separately from Paramount shares.
Saudi Arabia’s Public Investment Fund, Qatar Investment Authority and Abu Dhabi’s L’imad Holding Co. are joining U.S.-based firms RedBird and LionTree as investors in the merger, Paramount said in an SEC filing Tuesday. The disclosure follows reporting by the Wall Street Journal that was later confirmed by Deadline. Combined, the three Mideast entities are contributing $24 billion to the deal, the WSJ said.
If anything should arise before the deal closes, the Ellison family (headed by Larry Ellison) has pledged to provide a guarantee for any outstanding amount. In previous WBD proposals by Paramount, minority investors also included China’s Tencent as well as Affinity Partners, an investment firm run by Jared Kushner, son-in-law of President Donald Trump. Saudi Arabia’s PIF is the largest investor in Affinity Partners. Both Tencent and Affinity later dropped out of the deal.
The idea of funds controlled by the governments of Saudi Arabia, Abu Dhabi and Qatar being stakeholders in the CBS broadcast network, local stations, CNN and other assets has raised alarms among many Democrats. Some have insisted in recent months that the merger would have to be reviewed by the Committee on Foreign Investment in the United States. The committee, chaired by the secretary of the treasury, assesses potential national security risks of foreign direct investment.
Paramount has previously pushed back on the idea of a CFIUS review, citing the fact that the Middle East investors would not be part of the corporate governance of the merged entity. A Treasury spokesperson did not return Deadline’s request for comment, but Democrats on Capitol Hill have been pushing for such a review. They also see a role for the FCC due to the presence of CBS and its broadcast stations in the media goliath’s portfolio.
Netflix, whose $82.7 billion deal for the Warner Bros. studios-and-streaming business wound up being displaced by Paramount’s two months later, pointed to the foreign ownership element as it jockeyed for the Warner assets.
Paramount views the equity syndication arrangement allowing the new group of investors to get involved as “an important milestone” in the WBD deal process, maintaining in the filing that it “will not impact the timing or likelihood of closing.” Having “diversification” in the ownership of Paramount will also unlock “the potential for strategic and commercial opportunities” with the equity syndication partners.
In recent years, Middle East funds have leveraged their trillion-dollar valuations to take stakes in a range of sports, media and tech properties. Saudi Arabia’s PIF launched the LIV Golf league, wooing a number of longtime PGA Tour pros to switch to its circuit, paying them sums reaching nine figures.
Paramount and the Middle East have longstanding ties. RedBird, whose founder, Gerry Cardinale, is a Paramount board member and a longtime advisor to David Ellison, teamed with Abu Dhabi-based International Media Investments in 2022 to create a joint fund investing in media and sports properties. Overseen by longtime NBCUniversal and CNN exec Jeff Zucker, the company has pulled off a string of deals, including last month’s $8 billion merger of major TV production entities All3Media and Banijay Entertainment.
RedBird is also a backer of Matt Damon and Ben Affleck’s production entity Artists Equity, which was co-founded by Cardinale.
Ted Johnson contributed to this report.
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