Paramount has reached an agreement with 12 state attorneys general, removing a major hurdle to its proposed acquisition of Warner Bros. Discovery, reports said, citing sources.
The agreement comes just days before Paramount was due to start paying a $7 million daily “ticking fee” from October 1. Bloomberg was the first to report the development, followed by The Wall Street Journal.
The proposed $111 billion merger, the largest in Hollywood history, had been put on hold because of an antitrust lawsuit filed by the states. The trial in the case was scheduled to begin on March 2, 2027.
Antitrust Case Was Holding Up The Deal
California Attorney General Rob Bonta led the 12-state coalition that sued to block the merger, despite the deal having received prior approval from the US Department of Justice.
Judge Araceli Martinez-Olguin later granted a restraining order, saying the states had presented a strong case that the merger could hurt competition in the basic cable and theatrical markets.
Paramount subsequently agreed to pause the transaction until a trial on the merits rather than fight a motion for a preliminary injunction.
The states had argued that the merger could result in higher prices and fewer options for theatres, cable and satellite providers. They said those higher costs could eventually be passed on to consumers.
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Details of the agreement have not yet been made public.
However, Paramount and the states have spent the weekend in tense negotiations over the company’s commitments to remain in California and its production levels.
The discussions also included editorial oversight of CBS and CNN, which was a key concern for attorneys general on the East Coast.
Paramount’s Case For The Merger
Paramount has maintained that the merger is pro-competitive and would lead to increased content production.
The company has argued that combining with Warner Bros. Discovery would help it compete with major streaming companies such as Netflix and Amazon.
In recent weeks, Paramount had increased pressure on Bonta to settle the case. The company had threatened to leave California and move to Texas or Tennessee if an agreement could not be reached.
Paramount had also enlisted Democratic state lawmakers to urge Bonta to settle, while IATSE and the Directors Guild of America had pushed for a deal.
The agreement with the 12 states now removes a major legal obstacle to Paramount’s proposed acquisition of Warner Bros. Discovery, although further steps will still be required before the transaction can close.