The deal that is expected to install Skydance chief David Ellison as chairman, CEO and, hopefully, savior of Paramount Global is a maze of entities, trusts and transactions. Also potentially complicated, assuming the deal closes sometime next year, is the question of control.
Skydance sources say David, 41, will select the board and run things completely independently of his father, Larry Ellison, also known as the fifth richest man in the world, with an estimated net worth of $176 billion, according to BloombergOn September 18, Larry, 80, will own the controlling shares. Having already given billions to David and his sister, Megan, Larry has now backed his son with $6 billion as David pursues his dream of running a traditional studio.
It’s unclear what role, if any, Larry will play in the new Paramount. But given his history of significant MAGA activity, there’s sure to be scrutiny, though probably not of the regulatory kind, since Paramount Global runs the operations of CBS News and 28 licensed broadcast television stations controlled by the Lawrence J. Ellison Revocable Trust. On the other hand, Larry’s son does not share his politics and has contributed to Democratic causes. A Skydance source says The Hollywood Reporter that Larry will be busy running Oracle and scoffs at the idea that the tech mogul has any connection to Paramount.
But industry veterans don’t see a world in which Larry puts in billions without creating, at the very least, a mechanism to allow him to act if David falters in his effort to revive the failing media company. “Knowing Larry Ellison, I doubt he’ll ever relinquish control,” says one prominent media figure. “Skydance may want to make it seem like it’s independent, but there’s no way it is.”
John Coffee, a Columbia University law professor and expert on corporate governance, says it’s likely that “the father does have latent power in this case, but he doesn’t want to humiliate the son.” Another source who has worked with Larry says he expects to be privy to major spending and budgeting decisions but won’t be heavily involved in the day-to-day. And even if things go awry, the Paramount venture won’t require him to mortgage the 98 percent of the Hawaiian island of Lanai that he owns. “David wanted to do it,” this person says, “and for Larry, this is a rounding error.”
Larry knows all too well that Hollywood is a great place to spend money. When David was a 23-year-old aspiring actor, his father supported him in making a living. Flying Boysa $65 million film starring David as a pilot. The film grossed less than $18 million. By the time David founded Skydance in 2006 and his sister, Megan, founded Annapurna in 2011, Larry had not only made them billionaires but had connected them with powerful advisors, including Steve Jobs, David Geffen and attorney Skip Brittenham.
David and Larry Ellison at the BNP Paribas Open at Indian Wells Tennis Garden on March 14, 2022 in Indian Wells, California.
Megan proved reluctant to be mentored, and Larry stepped in in 2018, when her Annapurna Pictures, after a promising start, began to derail. “She spent over $500 million,” says the source familiar with the situation. (A representative for Annapurna denies that claim.) And despite Larry’s intervention, Annapurna continues to face problems. The entire staff of its interactive division — about 25 employees — resigned on Sept. 12 after Megan backed out of negotiations to spin it off as an independent company.
When it comes to local films, David’s track record has been mixed: he stumbled upon original films Gemini man and Terminator Genisyspart of an ambitious plan to revive the franchise, but it was successful in selling films, including The war of tomorrow and The old guardto streaming services. He has irritated some Paramount executives by suggesting that Skydance made movies like Top Gun: Maverick and the Mission: Impossible films. While Ellison advocated for a The best gun In 2022, Skydance switched its first-look deal from Paramount to Apple and signed a short-lived pact for animated films under the aegis of John Lasseter. After making one film, LuckThe deal has since moved to Netflix, where a second project is in the works.
At this point, David has plenty of Hollywood experience, but one Paramount veteran notes that the studio is a fraction of the parent company’s overall economics. “How do you solve a problem like (the decline of) linear TV, which is the problem that every media company faces?” this person says. “That’s the problem they’re going to face, and that’s not David’s strong suit. It’s also a problem for Bob Iger and David Zaslav. If a company as powerful as Disney hasn’t been able to solve it, well, that’s where you can see Larry having some involvement at some point.” Skydance has said that former NBCUniversal CEO Jeff Shell will serve as chairman of the new Paramount Global and is presumably expected to address those challenges.
David Ellison talks to Tom Cruise as he attends the Royal Film Performance and UK premiere of Top Gun: Maverick at Leicester Square on May 19, 2022 in London, England.
Notably, Shell has endorsed Democratic candidates, including Kamala Harris in her 2020 presidential campaign. In a filing with the FCC, which will review the proposed merger of Skydance and Paramount, the potential new owner-operators were clearly playing along with Democratic Chairwoman Jessica Rosenworcel. The filing said the deal will bring new investment to “the legendary newsgathering and reporting efforts of the CBS national television network and the company’s local stations” and promised that CBS and the stations will remain “trusted sources of news.”
Progressive groups will no doubt be watching closely for any potential rightward shifts, but a Skydance source says flatly: “Larry is not going to set the editorial vision for CBS.”
Larry’s politics are no mystery. In 2020, he hosted a fundraiser for Donald Trump at his Rancho Mirage estate. Days after the 2020 election, he participated in a call with a group that included Sean Hannity, Lindsey Graham, and Trump’s then-lawyer Jay Sekulow to discuss ways to challenge the result. (It’s unclear whether all the participants agreed; Sekulow later backtracked, while Hannity promoted conspiracy theories for months.)
Later, Larry told him Forbes Larry Larry said he would support any president in office, which seemed like a backhanded acknowledgement that Joe Biden had won the election. But when it came time for the 2022 midterms, Larry donated more than $20 million to a Super PAC that backed four Senate candidates who denied they could win the election, including the embattled former football star Herschel Walker. In a Senate with a razor-thin Democratic majority, two of those contenders — Ron Johnson of Wisconsin and Ted Budd of North Carolina — won their seats. More recently, Larry donated $30 million to Republican Sen. Tim Scott’s PAC and lobbied Trump to pick Scott as his running mate.
David, for his part, donated $929,600 to the Biden Victory Fund in the first quarter of this year. Now, an informed source says that neither David nor Larry will be making any further donations in this election cycle.
While Larry may not be the most politically desirable benefactor for an entertainment company, analyst Rich Greenfield says his technological capabilities may, in fact, lead to transformative change. And Larry’s checks do cash, giving Paramount some breathing room after the deal. “The problem with most media companies is that they don’t have the balance sheet or the ability to build for the future,” Greenfield says. “I think having a 40-year-old CEO (41, but who’s counting?) backed by one of the richest men in the world should allow them to think decades into the future, rather than the next quarterly earnings call. The world is littered with failures. At least they have a chance.”
Alex Weprin contributed to this report.
This story appeared in the Sept. 19 issue of The Hollywood Reporter magazine. Click here to subscribe.
