The War That Funded A Merger

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The War That Funded A Merger

The Drey Dossier

Mar 27, 2026

We are on day 27 of the war with Iran, and somewhere in that fog there is a truth about alliances that nobody in Washington will say out loud: you do not investigate your wartime partners. You do not audit their capital. You do not ask where their money is going while their cities are absorbing missile strikes on your behalf. The alliance becomes a kind of immunity, and the people who understand power have always known that the best time to move money is when the country whose regulators might object is busy being grateful.

Today, while the President extended the war deadline for the second time, Warner Bros. Discovery mailed a 266-page proxy statement to its shareholders asking them to approve the sale of their company to Paramount for $111 billion, which would make it the largest media merger in American history. If it goes through, one company will own CNN, HBO, CBS News, and Warner Bros., all of it running on Oracle’s cloud, and the shareholder vote is April 23rd.

266 Pages Later

The proxy names two equity investors: Larry Ellison’s personal trust at roughly $47 billion, and a private equity firm called RedBird Capital at $250 million. The guy who runs RedBird is named Gerry Cardinale, and according to Matt Belloni’s reporting, he was personally in the Middle East with David Ellison and Ari Emanuel recruiting investors for this deal. Remember his name because he comes back later.

Two names on a $111 billion deal; and that’s strange, because three months ago when Paramount first launched its bid, the SEC filings told a completely different story. In December there were seven investors. The Ellison Trust and RedBird, yes, but also Saudi Arabia’s Public Investment Fund, sovereign wealth funds from Qatar and Abu Dhabi, Jared Kushner’s firm Affinity Partners, and Tencent, the Chinese tech giant that is literally on the Pentagon’s list of Chinese military companies. Together the foreign investors were putting up $24 billion, and it was reported everywhere because it was in the public filings.

That caused a massive problem. There’s a call documented in the proxy itself where David Zaslav, Warner Bros.’ CEO, told David Ellison directly that including those investors raised serious legal and regulatory concerns. The issue was CFIUS, the Committee on Foreign Investment in the United States, which is the government body that steps in when foreign money flows into American companies and asks whether it’s a national security risk. Having Saudi and Emirati government funds as named investors in a company that owns CNN and CBS News would trigger that review and potentially block the whole deal. So the board told Paramount to get them off the paperwork, fully backstopped by the Ellison family, no foreign names.

And Paramount did that, on paper. The definitive agreement signed February 27th names only the Ellison Trust and RedBird; Gulf funds gone, Tencent gone, Kushner gone. No foreign names means no CFIUS review, no national security check, nobody asking whether this is a risk.

But here’s what they did at the same time.

About a hundred pages into the proxy, buried in the subscription agreements, there’s a provision that says the Ellison Trust can assign, meaning hand off, portions of its commitment to other investors after the deal is signed; and the way it’s written, for most assignments Warner Bros. doesn’t even need to consent, just notify. The only assignments that require consent are ones that would trigger CFIUS, push foreign ownership past 25%, or involve a designated foreign adversary country, and Saudi Arabia, Qatar, and Abu Dhabi are not designated foreign adversary countries; they’re U.S. allies. So PIF can receive an equity assignment through a U.S.-registered entity, stay below 25%, and enter this deal after the vote with nothing more than a notice.

When I realized that, I had to stop and ask myself who these investors actually are that were in December and might come back in, because these aren’t hedge funds looking for a return; these are governments. PIF is Saudi Arabia’s Public Investment Fund, $1.15 trillion, controlled directly by Crown Prince Mohammed bin Salman. Think about whoever you trust to give you the news, whoever that is. In Saudi Arabia, that person goes to prison if they write something MBS doesn’t like. There are 19 journalists in Saudi prisons right now. And in 2018, a Washington Post columnist named Jamal Khashoggi walked into the Saudi consulate in Istanbul to get paperwork for his wedding. He had three kids. His fiancée waited outside for hours. He never walked out. Saudi agents killed him in that building and dismembered his body. The CIA concluded MBS ordered it, and nobody was held accountable.

That’s PIF; that’s the money that was in the December filing and vanished from the 266 pages that went out this week.

And we don’t have to guess what happens when Saudi money gets near Western media because it already happened. Vice had a content partnership with MBC Group, which PIF now majority-owns, and Vice reporters came forward and said that stories about Saudi human rights abuses got killed or delayed because of that relationship. Bloomberg had a similar Saudi partnership and had to scale the whole thing back because the editorial influence was too obvious. Those were just content deals, just business partnerships. What we’re talking about now is equity ownership in the parent company of CNN, and PIF already controls the biggest content licensing and distribution platform in the Middle East, one that already has deals with both Warner Bros. and Paramount.

That’s who is on the other side of that door in the proxy. So I needed to know whether they’re actually getting ready to walk through it.

What Delaware Told Me

After I finished the proxy, I started pulling threads through the Delaware Division of Corporations, which is a public database where companies register their legal entities and anyone can search. PIF brands its investment vehicles under a specific name: Savvy. Savvy Games Group is their gaming portfolio, the one currently in the middle of taking Electronic Arts private for $55 billion with Kushner. So that’s where I started.

Most of the results were noise: Savvy Accounting Corp, Savvy Armor LLC, nothing worth a second look. But sitting in the middle of them was a recent registration called Savvy Capital Partners LLC, formed October 8th, 2025. Not Savvy Games; Capital Partners, which is a broader name, the kind you give a vehicle that’s meant to move across sectors.

So I ran PIF itself, just the three letters, and that’s where the picture came together.

PIF 2025 Blocker I LLC and PIF 2025 Blocker S LLC. Both formed October 20th, 2025, same day, sequential file numbers, same registered agent: the Corporation Trust Company at 1209 Orange Street in Wilmington, which is CT Corporation, what the biggest law firms in the country use when they’re building billion-dollar deal vehicles.

A blocker, for context, is actual financial terminology, not a name I’m giving it. When a foreign government wants to invest in a U.S. company, it has a tax problem and a visibility problem, so it creates a U.S.-registered LLC that sits between itself and the deal. The foreign money goes in, the LLC invests in the American company, and on paper the equity holder is a Delaware entity instead of a foreign government; that’s called a blocker because it blocks the tax exposure, and PIF put it right in the name. But it also means that on paper, the equity in this deal wouldn’t be held by the Public Investment Fund of Saudi Arabia. It would be held by PIF 2025 Blocker I LLC, a limited liability company registered in the state of Delaware, and that distinction matters when regulators are counting how much of a company is owned by foreign investors.

Nobody creates blocker entities for fun; you create them when you have a specific transaction you’re getting ready for.

Now look at the timeline. October 8th, Savvy Capital Partners formed in Delaware. October 14th, David Ellison emails Zaslav reiterating his desire to acquire WBD. October 16th, Netflix makes its first call, Ted Sarandos to Zaslav. October 20th, PIF Blocker I and Blocker S formed, same day, same agent. November 18th, first public report of the consortium. December 8th, hostile bid filed, PIF named at $24 billion. February 27th, definitive agreement signed, PIF gone. March 27th, proxy mailed to shareholders, PIF absent from 266 pages.

PIF was building legal infrastructure for this deal before Netflix even entered the conversation. The document shareholders received this week doesn’t mention them, but the assignment provision a hundred pages in is how they get in, and the blocker entities are the vehicles they get in through. These are public records and I’ve included the file numbers below so you can look them up yourself.

What the Architect Said

At this point I’m looking at blocker entities that were set up months before this deal was public, and I’m wondering whether there’s some other explanation. And then I remembered something the man who built this deal said on a podcast three weeks ago.

On March 5th, Gerry Cardinale went on Matt Belloni’s podcast The Town, and Belloni asked him directly whether the Middle East backers are still in. Cardinale told him, “Haven’t syndicated anything at this time. We do expect to syndicate with strategic domestic and foreign investors, but at the end of the day, that alchemy shouldn’t matter because it’ll be done in the right way.” Syndicate in this context means to take the Ellison Trust’s $47 billion commitment and sell off pieces to other investors, which is exactly what the assignment provision allows. When Cardinale says he expects to syndicate with foreign investors, he is telling you the Gulf money is coming.

Belloni pushes him. You understand why people might be concerned about Middle East money having an ownership stake in a company that owns CNN.

Cardinale, at 19:04: “You look at what’s going on right now geopolitically out of the Middle East, the positives of that would not be happening without some of those sovereigns that you’re referring to. The world is changing.”

Then at 19:40: “At the end of the day, I do understand some of the concerns that you’ve raised, but that will work itself out between signing and closing because at the end of the day, worst case scenario, Ellison and RedBird aren’t 100% of this thing.”

He is justifying Gulf sovereign investment in the parent company of CNN by pointing to the geopolitical alliance during the Iran war, and then saying the syndication will happen “between signing and closing,” which means after the deal was signed on February 27th and before it closes later this year. The shareholder vote on April 23rd falls right in between. Shareholders vote on a deal with two names on it, and then new investors come in before it’s finalized. And Cardinale calls the scenario where there are no foreign government investors the “worst case.” Think about what the best case looks like in his mind.

Then Belloni asks about board seats, noting that Cardinale previously said no, the Middle East investors would not get seats. Cardinale, at 20:09: “That’s the premise we’re going on right now, but I haven’t revisited that since the last time we talked about it.” In December he said no board seats; three months later it’s “I haven’t revisited that.”

The blocker entities are built, the assignment provision is in the agreement, and the architect of the deal just told you on a podcast that the foreign money is coming.

The Window

All of this is unfolding against a war that makes every piece of it harder to challenge. On March 23rd, seven senators led by Cory Booker wrote to the FCC demanding a foreign ownership review of this deal, and on the same day Trump threatened to bomb Iran’s power grid if the Strait of Hormuz didn’t open in 48 hours. The next day the deadline passed and Trump extended it, and a 15-point ceasefire proposal went to Iran through Pakistan with Kushner involved in the negotiations, the same Kushner whose firm Affinity Partners was in the December WBD financing. On the 25th Iran rejected the proposal, two migrant workers were killed in Abu Dhabi from falling missile debris, Saudi Arabia intercepted a drone over the Eastern Province, and while their cities were getting hit, these governments were arresting their own people for posting about it. The UAE made it a crime to share unverified information about the attacks, and Saudi cybercrime law carries five years for posting content that “harms public order.” Same day, a lawsuit surfaced alleging Trump directly told Larry Ellison, “Larry, if you really want Warner Bros., I’ll make sure you get it.” And on the 26th, WBD filed the proxy and started mailing it to shareholders: 266 pages, zero foreign investors named.

The countries expected to take equity in the company that owns CNN are getting hit by missiles right now, and the deeper this war goes, the more those countries need the U.S. security umbrella. The deeper they embed their capital in American infrastructure, the stickier that relationship gets. You don’t launch a national security review of your wartime partner’s investment fund, and everyone at that table knows it.

If you’ve been reading my coverage, this is the window. Same window I wrote about in The Merger That Needed A War. The war eats the news cycle, the deals move underneath it, and by the time anyone looks up, the pipes are built.

Where It Stands

The seven senators asked FCC Chairman Brendan Carr for a full foreign ownership review under Section 310 of the Communications Act, public disclosure of every subscription agreement and side letter involving foreign investors, a formal public comment period, and coordination with CFIUS and the DOJ’s National Security Division. That’s a real letter with real asks, and the FCC hasn’t responded.

I don’t think we stop this deal; the money is too aligned, the politics are too aligned, and the timeline is too short. But the point was never stopping it. The point is what it looks like when it closes, because right now the terms of the foreign investment haven’t been finalized. Cardinale said it himself: it happens between signing and closing. That means the window where the terms get decided is right now. How much equity the Gulf funds get, whether they get board seats, what access they have to subscriber data and news operations; all of that is being negotiated while you’re reading this.

The more people paying attention, the harder it is to give away the keys quietly. Nobody hands MBS a board seat at the parent company of CNN if a million people are watching; they’ll do it if nobody is.

Up Next: The Merger That Needed A War