Larry Ellison Owns 40.6% of Oracle and Has Backstopped $40.4 Billion of a Media Deal. Here's Why That's an Oracle Shareholder's Problem.
The promise hasn't changed since December. The stock behind the man who made it has been cut by more than half.
Overview
Larry Ellison owns 1.16 billion shares of Oracle (NYSE: ORCL) through his family trust -- 40.6% of the company, worth about $139 billion at the current share price.
In December, he put a piece of that fortune behind a media deal. Warner Bros. Discovery's board had questioned whether the equity backing Paramount Skydance's all-cash offer was solid, and it wanted more than a trust's balance sheet behind the bid. So Ellison gave an irrevocable personal guarantee covering $40.4 billion of the offer's equity financing, plus any damages claims against Paramount. He also agreed not to revoke the trust, or move assets out of it, while the deal is pending. Paramount published records confirming the trust's Oracle stake and noted that all of the trust's material liabilities are publicly disclosed.
Details
At the time, the guarantee was a show of strength. Today, however, it looks different. The tech company's stock trades near $120 as of this writing, after touching a 52-week low of $114.50 on Tuesday, down about 65% from its high of $345.72. The promise hasn't changed, but the wealth behind it has.
Source
Originally published at www.fool.com.