Paramount Settles Lawsuit, Warner Bros. Merger to Proceed — SkimNews
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- Paramount Skydance plans to settle a lawsuit led by California AG Rob Bonta and 11 other states that sought to block its $110 billion merger with Warner Bros. Discovery on antitrust grounds.
- The settlement terms include the creation of independent editorial boards for CNN and CBS, plus a $30 million penalty per film if Paramount falls short of its pledge to release 30 movies annually.
- The lawsuit had been set for trial in March, which would have left the deal in limbo through mid-2027, prompting Paramount to agree to a delay until June 2027.
- A "ticking fee" in the merger agreement would have kicked in after Sept. 30, adding an estimated $650 million per quarter — 25 cents per share — to the deal's value for WBD shareholders if it didn't close.
- The deal had already won approval from U.S. and other international regulators before California and 11 other states filed suit in mid-July, with Paramount telling investors it expected to close by Sept. 30.
- The combined company would unite the Paramount and Warner Bros. Discovery film studios, CBS broadcast network, a portfolio of TV networks, and streaming services Paramount+ and HBO Max.
Why it matters: Settling the antitrust challenge clears the path for a $110 billion media merger uniting Paramount's CBS and Paramount+ with Warner Bros. Discovery's HBO Max and film studios. The ticking fee of an estimated $650 million per quarter starting after Sept. 30 created mounting pressure to resolve the case, with concessions on editorial boards and film output serving as remedies for the states.
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