Paramount Skydance has held talks about securing Elon Musk as an equity investor, according to a Wednesday Semafor report, while its stock continues to hover near multi-year lows.
Chief Executive Officer David Ellison is seeking wealthy financial backers to purchase newly issued shares in order to raise fresh capital in the wake of the Warner Bros. Discovery acquisition.
Why Paramount Wants Elon Musk’s Money
According to a company release from February, Paramount reached an agreement to acquire Warner Bros. Discovery (WBD)—the parent company of CNN, HBO, and the Warner Bros. studio—for $30 per share in cash, putting the total valuation of WBD at $108 billion inclusive of debt.
The financing plan features $43.6 billion in equity committed by the Ellisons and RedBird Capital Partners, alongside $54 billion in additional loans.
Semafor reported that Larry Ellison, the billionaire founder of Oracle and father of David, has personally guaranteed upwards of $40 billion of that equity. Bringing in new investors would help distribute that financial responsibility.
Musk maintains close connections with the elder Ellison. Larry Ellison contributed $1 billion toward Musk’s acquisition of Twitter in 2022, previously invested in Tesla in 2018, and spent years serving on Tesla’s board of directors.
The exact size of the potential stake remains undetermined, but Musk—who attained the status of the world’s first trillionaire in June—is among several affluent individuals being evaluated.
Paramount Stock Nears Multi-Year Lows
Yahoo Finance data showed Paramount’s Class B shares (PSKY) increasing by 0.8% to reach $10.19 on Wednesday afternoon. This minor uptick offers little relief against a 74.6% decline over the past five years.
The equity trades at less than 50% of its 52-week peak of $20.86, while its 52-week trough stands at $7.62.
TradingView weekly charts indicate the stock has remained bound between roughly $10 and $15 for the majority of the last three years, contrasting sharply with early 2021 when prices surpassed $95 under the former ViacomCBS moniker.
Earlier in the week, Paramount successfully resolved an antitrust lawsuit initiated by state attorneys general, thereby eliminating a major barrier to finalizing the transaction, though a temporary market rally prompted by the announcement has since subsided.
Musk Stake Could Draw Scrutiny in Washington
Semafor’s reporting noted that financial backing from Musk would serve as a strong endorsement from a prominent billionaire commanding a loyal retail investor base.
Conversely, the same report highlights potential political complications. Throughout the 2024 election cycle, Democratic lawmakers expressed apprehensions regarding Musk’s financial influence and his ownership of X (formerly Twitter).
The analysis suggests that even a minor equity stake by Musk in CBS and CNN could trigger concern in Washington, despite the likelihood that he would hold no formal operational authority. At present, no formal agreements have been announced.