Key facts
- Paramount Skydance's $110 billion takeover of Warner Bros. Discovery is under EU Foreign Subsidies Regulation scrutiny.
- The review targets approximately $24 billion in equity financing from Saudi Arabia's Public Investment Fund, Qatar Investment Authority, and L'Imad Holding.
- The European Commission has set an initial deadline of July 14 for its decision.
- The deal is also being reviewed under standard EU merger rules, with a decision due July 7.
- The Foreign Subsidies Regulation aims to prevent foreign state aid from distorting competition within the EU.
The European Commission has initiated a review of Paramount Global's proposed $110 billion acquisition of Warner Bros. Discovery under the EU's Foreign Subsidies Regulation (FSR). This scrutiny centers on approximately $24 billion in equity financing provided by Middle Eastern sovereign wealth funds, including Saudi Arabia's Public Investment Fund (PIF), Qatar Investment Authority (QIA), and Abu Dhabi's L'Imad Holding.
The FSR is designed to address concerns that foreign state aid could create unfair competitive advantages within the European Union. The Commission will decide by an initial deadline of July 14 whether to approve the deal or launch a more in-depth, 90-working-day investigation.
This subsidy review runs parallel to an ongoing standard merger control investigation, which has a separate deadline of July 7. While the subsidy review is anticipated to be less complex than the merger review, potential remedies or concessions might be required if competition concerns arise. Paramount's CEO, David Ellison, is navigating this regulatory landscape as one of the final hurdles for the acquisition, which aims to unite significant Hollywood studios, news networks, and streaming platforms.