Bloomberg Intelligence Larry Ellison’s Guarantee Ups Warner Bros. Stakes to a New Level
Dec 22, 2025
In this discussion, Stephen Flynn, a Senior Credit Analyst, unpacks Larry Ellison's staggering $40.4 billion personal guarantee to back Paramount's bid for Warner Bros. He highlights the implications this guarantee has for financial ratings and creditor outcomes. Jodi Lurie dives into the cruising industry's recovery, revealing insights on customer behavior and cash flows compared to theme parks. Brian Campbell, from The Conference Board, addresses rising CEO turnover rates and the growing influence of shareholder activism in corporate governance.
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Ellison's Guarantee Raises The Stakes
- Larry Ellison's $40.4 billion personal equity guarantee materially strengthens Paramount Skydance's bid for Warner Bros. Discovery.
- Pro forma combined company remains highly levered even after assumed synergies and secured bridge debt considerations.
Deal Structure Affects Leverage And Ratings
- The deal structure pairs $40+ billion of equity with a $54 billion secured bridge, which alters creditor priority and leverage metrics.
- Through the secured debt the pro forma leverage could be nearer to ~3x, potentially comparable to investment-grade peers like Charter.
Bondholders Might Favor Paramount Skydance
- Bondholders may prefer the Paramount Skydance transaction because incoming equity supports the company and secured debt sits senior.
- A Netflix-led breakup sale could leave bondholders stuck with a spun-out, highly leveraged global networks business with declining fundamentals.