EU Clears $110bn Paramount-Warner Bros. Merger as US Court Battle Delays Deal
The European Commission has approved Paramount Skydance’s proposed $110 billion (£85 billion) acquisition of Warner Bros. Discovery, removing a major regulatory hurdle for the media merger even as the deal remains stalled in the United States.
The approval came after Paramount agreed to end its European film distribution partnership with Universal Pictures. Under the commitments made to regulators, the company will terminate the arrangement within 13 months and will be barred from entering into a similar agreement for the next 10 years.
European competition authorities had raised concerns that the partnership with Universal could give the merged company excessive influence over cinema distribution across the region.
Despite securing approval in Europe, the transaction remains on hold in the US following legal action by a coalition of 12 states seeking to block the merger.
The states argue that combining the two entertainment giants would reduce competition, harming movie theatres, cable television distributors and consumers.
Although the US Department of Justice announced in June that it supported the merger, US District Judge Araceli Martínez-Olguín has temporarily paused the takeover while the states’ legal challenge is considered.
Corporate lawyer Alon Kapen said the temporary restraining order does not determine the outcome of the case but indicates the court considers the states’ competition concerns significant enough to warrant further review.
The delay could also prove costly for Paramount.
Under the terms of the agreement, if the merger is not completed by 30 September, Paramount will be required to pay Warner Bros. Discovery shareholders a “ticking fee” estimated at around $7 million per day until the transaction is finalised.
The proposed merger is also facing opposition from the Writers Guild of America (WGA), which argues the combined company could reduce opportunities for writers while increasing its bargaining power during contract negotiations.
WGA President Tom Fontana said the merged business would have significant leverage to suppress wages and limit employment opportunities for emerging writers.
In the United Kingdom, regulators are also assessing whether to intervene in the deal, citing concerns over local news, children’s programming and competition within the streaming market.
Paramount has defended the acquisition, arguing that the merger would strengthen its ability to compete globally while pledging to release at least 30 films in cinemas each year—double its current annual output.
