Warner Bros Discovery’s board has decisively turned down Paramount’s $108 billion all-cash acquisition proposal, labeling it as ‘illusory’ and not aligned with shareholder interests.

Instead, the board emphasized its commitment to the forthcoming $82.7 billion agreement with Netflix.

Samuel A. Di Piazza Jr., the board chairman of Warner Bros Discovery (WBD), urged shareholders to dismiss Paramount’s eleventh-hour offer, issuing a sharp statement on Wednesday morning.

“We are eager to proceed with our merger with Netflix, which promises substantial and assured value for shareholders,” the statement highlighted.

The board also criticized Paramount CEO David Ellison, accusing him of misleading WBD shareholders about the supposed financial backing from the Ellison family for the proposed deal.

“There is no such backing, nor has there ever been,” Di Piazza Jr. clarified.

The board also pointed to a $40.65billion equity commitment from Paramount that relies ‘on an unknown and opaque revocable trust’.  The statement said that despite repeated assurances from Ellison family, they ‘have chosen not to backstop the [Paramount] offer’. 

Ellison is the son of 81-year-old billionaire Larry Ellison, an outspoken Trump ally. He desperately courted Warner chief David Zaslav during the bidding process.

Paramount boss David Ellison’s all-cash offer for the entirety of Warner Bros. Discovery was  rejected on Wednesday

Ellison, 42, desperately courted Warner boss David Zaslav in hope of making a deal

Warner Bros’s board agreed unanimously that a revocable trust is ‘no replacement for a secured commitment by a controlling stockholder’. 

‘We are confident that our merger with Netflix represents superior, more certain value for our shareholders and we look forward to delivering on the compelling benefits of our combination,’ the board said.

‘Nothing in this structure offers WBD shareholders any deal certainty. The PSKY offer provides an untenable degree of risk and potential downside for WBD shareholders,’ the statement added. 

Netflix released its own statement saying it ‘welcomes’ the board’s recommendation. 

A key difference between the two bids was Paramount’s interest in Warner assets like CNN and TNT, which Netflix isn’t interested in buying.  

Unlike Paramount’s, Netflix’s offer is also a mix of cash and stock.

Several sovereign wealth funds from Saudi Arabia, Qatar, and Abu Dhabi are also supporting Paramount’s bid as ‘outside finance partners’, as is the private equity firm run by Donald Trump’s son-in-law, Jared Kushner. 

If investors opt for Netflix, they will receive a piece of prospective profits from the yet-to-be solidified spinoff company that will include channels like CNN, TBS, TNT and other linear assets, due to the deal being a mix of cash and stock.

Paramount,  was looking to acquire those channels – particularly CNN – as well.

The board claimed Ellison and his father, Larry Ellison, have refused to provide enough financial insurance for the deal. The elder Ellison is worth $235.4billion, according to Forbes. He helped finance the $8billion merger over the summer that saw his son take over Paramount

The proposed transaction is for the entirety of Warner Bros. Discovery, including stations like CNN , TBS, and TNT, unlike Netflix’s. If Warner walks away from its already agreed upon Netflix deal, it will owe the streamer $2.8billion

 Last week, Ellison, 42, complained that Zaslav and Warner’s board were overseeing a ‘murky’ sale process. He also warned Netflix’s offer is hampered by ‘financial leverage’, due to the company’s massive market capitalization.

The elder Ellison reportedly floated to White House officials the firing some of CNN’s top talent if his son is able to acquire Warner Bros. Discovery.

He also reportedly pondered a programming change that would have put CBS’s 60 Minutes on CNN, The Guardian reported last month.

The younger Ellison installed right-leaning opinion writer Bari Weiss as CBS News’ editor in chief in October, after taking control of Paramount following an $8 billion merger signed off in July.

The prospect of being bought by Paramount has reportedly caused staffers at CNN ‘anxiety’ last month, sources told Status last month, citing the prospect of coming under the purview of Weiss.

Trump, at the time, told reporters that the multibillion-dollar Netflix deal ‘could be a problem’ because of antitrust concerns. 

Paramount’s offer will remain open until January 8, with the option for an extension. Shareholders will have the right to withdraw from the deal until then.

The Daily Mail has contacted Paramount for comment. The company has the option to increase its current offer but it remains unclear if they will do so.