Saudi Arabia, Qatar, and Abu Dhabi want to put billions into Paramount/WBD. Why?

• Paramount owners Larry and David Ellison are making a hostile bid for Warner Bros. Discovery.
• But they're not doing it alone: Three of their partners are oil-rich Saudi Arabia, Qatar, and Abu Dhabi.
• Those three nations won't have any say over a combined Paramount-WBD, the Ellisons say. So what will they get?

The governments of Saudi Arabia, Qatar, and Abu Dhabi want to invest billions of dollars into a would-be mega media conglomerate made up of Paramount and Warner Bros. Discovery.

What would they get for their money?

Spoiler: I don't know. And Paramount, the company that wants to use the three oil nations to help finance its bid for WBD, won't say.

But it sure seems like a question worth asking, as Paramount launches a hostile bid for WBD after losing last week's auction to Netflix.

Paramount says the three petrostates will be part of the new bid — as they were in Paramount's previous offers for WBD (something Paramount had at one point denied).

As of a week ago, those three countries were going to kick in $24 billion — double the $11.8 billion the Ellison family planned to invest in WBD.

Now, Paramount won't say how much the three countries' sovereign wealth funds plan to invest in their newest proposal. It says Larry and David Ellison, who currently own Paramount, along with RedBird Capital, the private equity group, will "backstop" the deal — meaning they promise to finance all of it if necessary.

But Paramount still anticipates those three countries will ultimately invest in a combined Paramount/WBD, along with Jared Kushner — Donald Trump's son-in-law, whose Affinity Partners group invests money on behalf of … Saudi Arabia, Qatar, and Abu Dhabi, among others.

The difference this time around, Paramount says, is that those countries' sovereign wealth funds won't have any say in how a combined Paramount-WBD would operate. They wouldn't get board seats, voting rights, or any other governance over the company. Paramount declined to comment.

The reason Paramount needs to stress that, apparently, is that Warner Bros. Discovery had previously flagged that as an issue. Now that the oil states won't have any say in how a combined Paramount-WBD would be run, Paramount says the deal wouldn't need approval from the Committee on Foreign Investment in the United States, a regulatory body that's supposed to sign off on foreign investments in some US companies.

That's all part of Paramount's pitch it is making to Warner Bros. Discovery shareholders: A deal for Paramount to buy WBD will pass regulators much more easily than Netflix buying WBD.

But who knows how that will actually pan out? Up until last week, the conventional wisdom was that Paramount would be the most likely winner for WBD, in no small part because Larry Ellison was a longtime Donald Trump backer, and his son, David, had been trying to curry favor with Trump as well.

Now it turns out that Netflix co-CEO Ted Sarandos was also wooing Trump. He visited Trump at the White House, and Trump seems to have been taken with him: "He was in the Oval Office last week. I have a lot of respect for him. He is a great person," Trump told reporters Sunday night. "Ted has really done a legendary job."

So in a world where Donald Trump is the most important decision-maker when it comes to what American companies are allowed to do, I don't know if the niceties of CFIUS rules will be the ultimate arbiter. (Here I'll note that last year the US passed a law that required China's ByteDance to divest itself of its ownership in the US. TikTok business or shut down. That hasn't happened, and TikTok is still alive and well in the U.S.)

I also don't know if Trump will particularly care that three Middle Eastern oil states could conceivably own a big chunk of a conglomerate that includes CNN, CBS, HBO, and two movie studios. He has been quite eager to do deals in the Middle East, and last month he rolled out the red carpet for the Saudi crown prince at the White House.

And perhaps that eagerness explains why Paramount didn't think it was a big deal to include petrostate investments in the past — and why it still thinks it's OK to have them now.

But again: If Saudi Arabia, Qatar, and Abu Dhabi are looking to put anything close to $24 billion into an enormously powerful media conglomerate — one with huge reach in both the US and ambitions for the rest of the world — will they be satisfied with purely financial returns? Or do they expect something else for their money?

I'd love to know. Maybe you would, too.

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