Affinity Partners, led by Donald Trump’s son-in-law Jared Kushner, has pulled out of Paramount’s hostile bid for Warner Bros Discovery (WBD).
The private equity company was one of several entities that had committed to support the bid by the family of Paramount CEO David Ellison, whose father is Oracle founder and centibillionaire Larry Ellison, alongside an aggregate $24bn commitment from three Gulf sovereign wealth funds, $1bn from China’s Tencent, and a commitment from RedBird Capital Partners.
The amount of Affinity’s commitment has not been disclosed, however that is now in the past. A spokesperson for the company said on Tuesday: “With two strong competitors vying to secure the future of this unique American asset, Affinity has decided no longer to pursue the opportunity.”
The statement continued: ”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.”
Paramount’s offer followed news on December 5 that WBD and Netflix had agreed to an $82.7bn sale for the former’s studios and streaming businesses.
Concerns that Kusher’s involvement might influence the battle for WBD given his family ties to the president were exacerbated when Trump said he would be involved in the decision, which requires regulatory approval in the United States from the Department of Justice and state attorneys general.
Affinity’s withdrawal came after Trump lashed out at Paramount-owned CBS, claiming the network’s flagship news show 60 Minutes has treated him “far worse” since David Ellison took over Paramount. In July, prior to Ellison getting his hands on Paramount, CBS paid Trump $16m to settle a lawsuit. Had Affinity been involved in a successful Paramount bid, Kusher would find himself partly owning WBD’s CNN, another news organisation that has ruffled the president’s feathers.
The involvement of Affinity Partners came to light on December 8, the day Paramount went directly to the WBD shareholders with its hostile all-cash bid to acquire all of the company for $30 a share that gave the target an enterprise value of $108bn.
WBD has until December 19 to respond to Paramount’s hostile offer.
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