The Justice Department’s Antitrust Division reportedly approved Paramount Skydance’s proposed acquisition of Warner Bros. Discovery, though California regulators continue to examine the deal.
By yourNEWS Media Newsroom
The Justice Department’s Antitrust Division has cleared Paramount Skydance’s proposed $111 billion acquisition of Warner Bros. Discovery, removing a major federal obstacle for one of the entertainment industry’s largest pending mergers, according to Politico.
The approval was expected to be announced Friday after federal regulators determined the transaction would not substantially damage competition, according to two people familiar with the matter. The Justice Department did not move to block the acquisition and did not require Paramount to sell assets, accept conditions or agree to other remedies as part of the review, the sources said.
Neither the Justice Department nor Paramount immediately responded to requests for comment.
The acquisition would combine Paramount with Warner Bros. Discovery, placing Warner Bros. Pictures, CNN and the HBO Max streaming service under the same corporate umbrella as Paramount. The deal became a major focus across the media industry after Netflix dropped a competing effort to acquire Warner Bros. Discovery following a brief bidding contest.
Paramount CEO David Ellison met with officials from the Antitrust Division for about two hours last month, according to one source. During that meeting, Ellison answered questions about how the merger would affect competition. Representatives from several state attorneys general offices, including California and New York, also participated in the meeting with federal officials.
Ellison’s family ties added political attention to the federal review. His father, Oracle founder Larry Ellison, is a longtime ally of President Donald Trump.
Although the Justice Department’s review has ended, the transaction is still being examined at the state level. California Attorney General Rob Bonta’s office continues to investigate the merger and could still seek to block it.
“The Paramount acquisition of Warner Brothers remains an active investigation,” a spokesperson for Bonta’s office told Politico earlier this week.
Paramount executives have spent months arguing that the acquisition would put the combined company in a stronger position against large streaming platforms and major technology companies, according to people familiar with the discussions.
The proposed merger has also drawn opposition from some industry workers and critics who argue that further consolidation could lead to job losses across the entertainment business. In March, Paramount Chief Operating Officer Andy Gordon told analysts the company expected more than $6 billion in synergies, most of them from non-labor sources.
The Justice Department’s decision followed a public dispute between Paramount and Netflix over the future of Warner Bros. Discovery. Paramount this week accused Netflix of waging a “scorched-earth campaign” against the acquisition by encouraging labor groups and others to oppose the deal.
Netflix denied the allegation, calling it “absurd.”
With federal antitrust clearance now reportedly secured, the Paramount Skydance acquisition still faces the possibility of further action from state regulators before the deal can move fully beyond government scrutiny.
Original article
Comments