Key facts
- Britain's Competition and Markets Authority (CMA) has cleared Paramount Skydance's $110 billion acquisition of Warner Bros Discovery.
- European regulators also cleared the deal after Paramount agreed to end a major film distribution partnership in Europe.
- The merger still faces a lawsuit from 12 US states and a temporary pause ordered by a US judge.
- Paramount has committed to releasing at least 30 movies in cinemas annually post-merger.
- The CMA's initial review phase has a deadline of August 7.
Britain's competition regulator has given the green light to Paramount Skydance's $110 billion takeover of Warner Bros Discovery, a significant step in the proposed merger. The Competition and Markets Authority (CMA) formally began its review and has until August 7 to decide if a deeper investigation is necessary.
European regulators also cleared the deal, contingent on Paramount ending a major film distribution partnership with Universal Pictures in Europe within 13 months and refraining from similar ventures for a decade. This move addresses concerns that the combined entity would wield too much control over cinema releases.
However, the acquisition faces substantial hurdles in the United States. A coalition of 12 US states has filed a lawsuit aiming to block the merger, citing potential harm to movie theaters, distributors, and audiences nationwide. Following this, a US judge issued a temporary pause on the takeover to allow for consideration of these legal claims.
Delays in completing the deal by September 30 could result in Paramount paying Warner Bros shareholders a daily 'ticking fee' of approximately $7 million. The Writers Guild of America (WGA) has also voiced opposition, warning that the merger could suppress wages and limit opportunities for writers.
Paramount asserts that the merger will benefit viewers by committing to release at least 30 movies in cinemas annually, doubling its current output. Meanwhile, UK regulators are independently assessing the deal for potential impacts on local news, children's television, and streaming competition.