Sens. Elizabeth Warren (D-Mass.) and Richard Blumenthal (D-Conn.) have criticized the Trump administration for not initiating a national security review of Paramount Skydance’s proposed $111 billion deal to buy Warner Bros. Discovery with billions of dollars in support from three Middle East sovereign wealth funds.
The senators had previously asked the Committee on Foreign Investment in the United States (CFIUS) to review the proposed agreement. CFIUS is a cross-agency agency of the U.S. government, led by the Treasury Department, that reviews foreign investments in U.S. companies for potential national security risks.
The financing for Paramount Skydance’s WBD deal includes funding from Saudi Arabia’s Public Investment Fund (PIF), Qatar Investment Authority (QIA) and Abu Dhabi Investment Authority (ADIA). Paramount’s offer for WBD as of Dec. 1 included a total of $24 billion from the Middle East fund, according to SEC filings. Since then, the company has not disclosed how much the three funds contributed to its successful bid for Warner Bros. Discovery, which was accepted by WBD’s board last month after Netflix chose not to compete with its offer of $31 per share.
“Given the cloud of corruption surrounding the Trump administration’s review of this deal from day one, it’s no wonder the Trump Treasury is holding its own by not investigating the $24 billion in national security risks from Middle Eastern sovereign wealth funds that are clearly flooding into this deal,” Warren said in a statement to Variety. are American consumers. Thanks to Donald Trump, the Paramount-Warner Bros. merger could mean higher prices and less choice, potentially allowing foreign actors to control what we see on our screens and access our private viewing information.
Blumenthal claimed that the Trump administration’s “review of the Netflix bid was grossly tainted by political interference and outright corruption.” “I have no confidence that Secretary[Scott]Bessent and Attorney General[Pam]Bondi will enforce our antitrust and national security laws regarding President Trump’s financial support,” the senator said in a statement regarding the Paramount-WBD deal.
Variety has contacted the Ministry of Finance for comment.
On December 4, Mr. Warren and Mr. Blumenthal, as CFIUS Chair, sent a letter to Secretary Bessent questioning the support of foreign investors for Paramount’s proposed acquisition of Warner Bros. and urging him to undertake a review of the proposed transaction.
In a letter dated February 27, the day after Netflix canceled its deal to acquire Warner Bros. The winning bid for WBD went to Paramount, which would combine its studio and streaming operations — senators received a response from Mason Champion, acting principal deputy assistant secretary in the Treasury Department’s Legislative Division. However, the letter does not say whether the Paramount-WBD deal will be reviewed by CFIUS.
“As Chair of CFIUS, Treasury takes seriously the potential national security risks that exist in certain transactions by foreign persons,” Champion said in the letter. “When a transaction is identified and within CFIUS’s statutory jurisdiction, CFIUS thoroughly reviews the national security implications of each transaction, including an assessment of the threats, vulnerabilities, and national security implications associated with the transaction, and takes appropriate actions.”
If CFIUS determines that a particular transaction poses a threat to national security, it may work with the parties to take steps to alleviate concerns. The committee could also recommend that the U.S. president block the deal.
In an SEC filing related to its hostile bid for WBD, Paramount Skydance claimed that three Middle Eastern sovereign wealth funds “agreed to waive any governance rights, including board representation, in connection with non-voting equity investments.” As such, Paramount says the transaction is “beyond the jurisdiction of CFIUS.”
Netflix co-CEO Ted Sarandos was asked about the Middle East sovereign wealth fund’s involvement in Paramount’s WBD bid before the company pulled out of its deal with Warner Bros. Specifically, in an interview on BBC Radio 4 Today on February 23, when asked by the television news network whether he thought it was wrong in principle for a foreign government to have any kind of financial ownership, he answered:
“I think this is a bad idea,” Sarandos said, noting that Arab wealth funds are in “an area of the world where the First Amendment is not very big.” “Given the level of investment we’re talking about, it seems very strange to me that they wouldn’t have any influence or editorial control over media in other countries,” the executive said of the idea that the three funds would have no board representation in the Paramount-WBD merger.
Paramount, the parent company of CBS News, will add CNN to its portfolio under the WBD deal. Paramount Skydance CEO David Ellison said earlier this week that CNN’s “editorial independence will absolutely be maintained” under the new ownership.
Meanwhile, other U.S. politicians are sounding the alarm about a potential Paramount takeover of Warner Bros. with the help of foreign investors. On December 10, Democratic Representatives Sam Licciardo (D-Calif.) and Ayanna Pressley (D-Mass.) said they had “serious national security concerns” about Paramount’s pursuit of Warner Bros. Discovery, given the involvement of the Middle East Fund. Lawmakers pointed out that the Saudi Public Investment Fund is controlled by Crown Prince Mohammed bin Salman. “U.S. intelligence agencies have conclusively implicated Prince Salman in the brutal murder of Washington Post reporter Jamal Khashoggi in an effort to suppress dissent,” the representatives said.
In a letter to Warner Bros. Discovery CEO David Zaslav and other WBD board members, Ricardo and Pressley said that in the future, a Democratic-controlled Congress and White House “could review many of the current administration’s decisions and recommend that regulators proceed with the sale, which would undermine the strategic logic of this merger.”
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