Affinity Partners, a private equity firm owned by Jared Kushner, the son-in-law of president Donald Trump pulled its financial backing on Tuesday from Paramount’s $108 billion hostile takeover bid to acquire Warner Bros. Discovery.
Paramount Skydance had launched a hostile bid worth $108.4 billion for Warner Bros. Discovery (WBD) following Netflix’s deal to buy the company’s TV, film studios and streaming assets for $27.75 per share, following a fierce bidding war involving Paramount and Comcast.
“With two strong competitors vying to secure the future of this unique American asset, Affinity has decided no longer to pursue the opportunity,” the firm said, according to The Associated Press. “The dynamics of the investment have changed significantly since we initially became involved in October. We continue to believe there is a strong strategic rationale for Paramount’s offer.”
READ: Paramount’s hostile bid for Warner Bros.: A look at how hostile takeovers work (
While the amount offered by Affinity was not disclosed in its SEC filings, the bid is still supported by wealth funds run by three governments, widely reported as Saudi Arabia, Abu Dhabi and Qatar, according to AP. Kushner’s involvement with Paramount’s offer was previously criticized by Sen. Bernie Sanders, I-Vt., who accused Trump of embracing “authoritarianism” after learning that the president’s son-in-law helped advance the hostile takeover bid.
While Paramount’s bid is for all of WBD, the Netflix agreement would leave out cable assets, including CNN. If Paramount’s attempt succeeds, it’ll be the fourth-largest hostile takeover to be completed over the past 20 years, according to data Dealogic shared with CNN.
A hostile takeover occurs when a company tries to take over another company by going around the takeover target’s management and making an appeal directly to shareholders. While such takeovers are less likely to be successful than friendly, agreed-upon acquisitions, and are risky and costly, they do tend to occasionally succeed.
READ: Paramount moves on $108.4 billion hostile takeover of Warner Bros. Discovery (
Before Paramount announced its bid, Trump had said he would have a say on whether the merger between Netflix and WBD would go ahead. Last week he told reporters at the White House that it was “imperative” CNN be part of any sale of the Warner Bros. Studios.
Paramount owner David Ellison took over the company after the merger between Paramount and Skydance Media. While Ellison is the son of a major Trump donor, he was heavily criticized by the president for his treatment by CBS News’ “60 Minutes.” “If they are friends, I’d hate to see my enemies!” Trump said Tuesday on Truth Social.
Warner is reviewing Paramount’s offer and is expected to tell shareholders soon whether it’s a better deal than selling to Netflix.