Democratic lawmakers are warning they’ll move to unwind any Paramount Skydance takeover of Warner Bros. Discovery, blasting the hostile bid’s backing from Saudi, Qatari and UAE sovereign wealth funds — and Jared Kushner’s private equity firm — as a national security threat.
Two Democrats in Congress — Reps. Sam Liccardo of California and Ayanna Pressley of Massachusetts — sent a letter to the board of WBD as well as to Treasury Secretary Scott Bessent on Wednesday expressing concern over potential national security risks that could arise from allowing foreign entities to control one of the country’s largest entertainment conglomerates.
“Future Congresses … will review many of the decisions of the current administration, and may recommend that regulators push for divestitures, which would undermine the strategic logic of this merger,” they wrote in the letter, which was first reported by the news site Semafor.
“We urge the Board to weigh these national security and regulatory liabilities in evaluating a transaction burdened by uncertain but potentially extensive mitigation obligations, foreign influence risks, or adverse regulatory action.”
Last Friday, it was announced that streaming giant Netflix would acquire WBD’s film and streaming divisions in a deal valued at $72 billion in cash and stock — beating out David Ellison’s Paramount.
Three days later, Paramount Skydance launched an unsolicited, hostile takeover bid for WBD’s entire operation — submitting an offer of $30 per share, which values the entire company at around $78 billion including cable assets like CNN.
But Paramount’s bid is also being backed by a consortium that includes Saudi Arabia’s Public Investment Fund as well as sovereign wealth funds controlled by the governments of Qatar and the United Arab Emirates.
Affinity Partners, the private equity firm owned by Kushner, President Trump’s son-in-law, is also among those backing Paramount’s bid — raising questions of a potential conflict of interest given that his father-in-law’s administration must ultimately sign off on any merger.
“These [foreign] investors, by virtue of their financial position or contractual rights, could obtain Influence — direct or indirect — over business decisions that bear upon editorial independence, content moderation, distribution priorities, or the stewardship of Americans’ private data,” Liccardo and Pressley wrote.
“Even absent overt control, such influence can present a national-security threat when foreign state-linked entities have strategic interests inconsistent with those of the United States.”
Paramount has sought to ease concerns about potential national security risks stemming from a possible takeover of WBD.
In a filing with the Securities and Exchange Commission, Paramount said the three Middle Eastern sovereign wealth funds as well as Kushner’s firm have “agreed to forgo any governance rights — including board representation — associated with their non-voting equity investments.”
Paramount aims to structure the deal in order to avoid scrutiny from the Committee on Foreign Investments in the United States, the interagency body that must approve any transaction that could involve national security risks.
Lawmakers from both parties have expressed reservations about a sale of WBD to either Netflix or Paramount — citing antitrust concerns.
The Post has sought comment from WBD, Netflix and Paramount.
Credit: Source link
