Democrats call for review of Paramount’s Middle Eastern financial backers

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Democratic politicians are calling for a closer look at who is funding Paramount Skydance, as they worry about foreign entities gaining control over American media companies.

Seven U.S. senators wrote a letter this week to FCC Chairman Brendan Carr to express their concerns about his statement that Paramount’s proposed $111 billion acquisition of Warner Bros. Discovery – which is supported by billionaire Larry Ellison and his family – appeared likely to be quickly approved with minimal review.

Mergers of this size usually face close scrutiny from government regulators. This particular deal would bring together two iconic movie studios, a wide range of cable channels including HBO and CBS, and leading news sources like CNN and CBS News.

Shari Redstone and her son, David Ellison, who leads Paramount, have a good relationship with former President Trump. Trump has often called for changes at CNN, and CNN is expected to become part of Paramount.

The company has said it expects to complete the deal by the end of September.

Democrats are worried the outcome of the merger review might be predetermined. While Trump’s Justice Department was investigating whether the merger would break anti-trust laws, they haven’t released any information after a significant deadline passed last month.

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If regulators allow the merger to go through, the Ellison family would own both CNN and CBS News.

Also at issue is the Middle Eastern money the Ellison family has been expecting to pull off Paramount’s leveraged buyout of its larger entertainment company rival. The acquisition would leave the combined company with nearly $80 billion in debt.

Toward the end of last year, Paramount announced it had secured $24 billion in funding from wealth funds linked to the royal families of Saudi Arabia, Qatar, and Abu Dhabi. These groups would then become part-owners of the company.

Paramount has stated that these investors, primarily royal families, will be largely hands-off, meaning they won’t be involved in making decisions for the company. They also won’t have any representation on the Paramount-Warner board.

Democratic members of Congress have repeatedly expressed worries about potential risks to national security. Senators Cory Booker of New Jersey and Chuck Schumer of New York continue to be concerned, especially since the deal could significantly impact the future of both Hollywood and major news organizations like CNN, which has a large international reach.

Party members are asking Carr to thoroughly and impartially review any foreign ownership involved before approving the merger. They believe the FCC could be key in this process, as the merger includes CBS – a station that holds broadcast licenses from the FCC.

Paramount declined to comment. FCC officials did not respond to a request for comment.

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In December, immediately after Netflix finalized the purchase of Warner Bros., the Ellisons and their colleagues started planning how to regain their position.

I was reading about the proposed Paramount-Warner deal, and it sounds like FCC Commissioner Brendan Carr made some interesting comments at a conference in Spain. Apparently, he hinted that the deal could get approved really quickly because of the foreign investment involved. He basically said it would be a ‘very quick, almost pro forma review,’ which seems to suggest it wouldn’t face much scrutiny. Senators Booker and Schumer have highlighted these comments, and it’s definitely something people are paying attention to.

Lawmakers reminded the FCC that it’s required to review foreign ownership, pointing to a U.S. law that limits how much of a company with an FCC license can be owned by foreign interests to no more than 25%.

The legislators referenced the FCC’s decision earlier this year to strengthen its rules about foreign ownership, making the process more open and clear.

Paramount has not yet disclosed its final list of equity partners.

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With the merger between Paramount and Warner Bros. Discovery nearing completion, several obstacles are emerging.

The company had previously revealed its potential partners in filings with the Securities & Exchange Commission. But last month, the agreement between Paramount and Warner changed when Larry Ellison committed to fully cover the $45.7 billion needed to buy Warner’s shares at $31 each.

Prior to John Ellison’s involvement, some Warner Bros. Discovery board members were worried about how Paramount would fund the deal. Ellison’s greater participation was key to completing it. Netflix withdrew from the bidding on February 26th, effectively handing the deal to Paramount.

Still, Paramount is expected to line up billions of dollars from outside investors.

Democrats noted that a $24 billion investment from Saudi Arabia’s Public Investment Fund, the Qatar Investment Authority, and Abu Dhabi’s L’imad Holding Co. would be a major development.

What really struck me about this deal isn’t just the money changing hands, but how that money is structured. According to the report, about 20% of the total cost isn’t coming from typical funding sources – it’s a significant chunk! And honestly, it sounds like this could be just the first wave of outside investment, which raises some interesting questions about the future direction of the company.

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S&P and Fitch Ratings are cool to the $79 billion in proposed Paramount-Warner Bros. debt.

Paramount originally had a deal to bring on Tencent, a Chinese tech company, as a minor investor. However, Paramount later ended that deal because the U.S. Department of Defense has blacklisted Tencent, raising concerns about the company’s standing.

Bloomberg News reported earlier this month that Tencent might return to the fold.

Booker and colleagues argued that the increasing investment from China and Gulf States – which have complicated ties with the U.S. – requires careful and thorough examination, not just a superficial one.

The letter was also signed by Senators Dick Durbin of Illinois, Elizabeth Warren of Massachusetts, Richard Blumenthal of Connecticut, Sheldon Whitehouse of Rhode Island, and Mazie K. Hirono of Hawaii.

The discussion focused on Saudi Arabia’s main investment fund, noting it’s directed by Crown Prince Mohammed bin Salman, who U.S. intelligence agencies believe ordered the killing of journalist Jamal Khashoggi in 2018.

This $24 billion investment would give these governments a major financial share in the future of a combined company featuring some of America’s most popular news and entertainment channels, including control over its content, licensing, and important decisions.

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Paramount Chief David Ellison explained to investors that the Warner Bros. acquisition isn’t about simply making the company bigger, but about fundamentally changing how the business operates.

It’s currently unknown if the ongoing conflicts in the Middle East, particularly those involving Iran, will affect Paramount’s group of investors.

Trump’s son-in-law Jared Kushner, a proposed Paramount investor, also withdrew late last year.

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HBO Max and Discovery+ together saw some growth in viewers, but it wasn’t enough to offset the ongoing decline in viewers of Warner’s traditional cable TV channels.

Paramount’s stock price remained at $9.17. However, since winning the Warner auction on February 27th, the stock has decreased in value by 31%.

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2026-03-25 01:03