The move comes as Warner Bros. is planning to reject the Paramount Skydance Corp. proposal that Kushner’s private equity firm had backed.
Affinity was helping to finance Paramount’s move. The participation of Kushner, Donald Trump’s son-in-law, in a deal that the president has said he would personally review drew a lot of unwelcome attention to Kushner, said people familiar with the decision. Affinity’s $200 million contribution to the financing was relatively minor, they said.
The dynamics of an investment have changed since it became involved in the process in October, a representative for Affinity said.
“With two strong competitors vying to secure the future of this unique American asset, Affinity has decided no longer to pursue the opportunity,” the investment firm said. “We continue to believe there is a strong strategic rationale for Paramount’s offer.”
One major sticking point in a deal has been Warner Bros.’ concern about the financing proposed by Paramount, which is led by David Ellison. The equity is backstopped by a trust that manages the wealth of Ellison’s father, software billionaire Larry Ellison. Because it’s a revocable trust, assets can be taken out of it at any time, and Warner Bros. may have no recourse if that happens, Bloomberg News reported.
Representatives for Warner Bros. and Paramount declined to comment.
Both bids raise significant antitrust concerns — something underscored by multibillion-dollar breakup fees the parties have offered. Netflix and Paramount have each been laying the groundwork to win over the White House.
