US Justice Department clears Paramount's takeover of Warner Bros Discovery in $110–111 billion deal, no conditions imposed

The US Justice Department completed its antitrust review of Paramount Skydance Corp's proposed acquisition of Warner Bros Discovery on Friday and determined the transaction does not pose a threat to competition, giving unconditional clearance to one of the largest media mergers in recent years. The deal is valued at between $110 billion and $111 billion, depending on the source, and would unite two of Hollywood's five largest studios as well as cable networks CNN and HBO and the streaming services Paramount+ and Max.

DOJ clearance

Regulators at the antitrust division closed their investigation without requiring any divestitures, behavioural remedies or concessions, according to people familiar with the matter. In a statement, the department said the evidence gathered during the probe showed the merger "is not likely to harm competition or American consumers" across video streaming, linear television and film development, production and distribution for theatrical release.

The impact of the merger will be to increase competition across the media and entertainment ecosystem, with benefits for American consumers and workers.

Paramount welcomed the decision. Its shares rose roughly 3 percent in after-hours trading on Friday. The company, led by film producer David Ellison, said it is focused on closing the transaction as quickly as possible, targeting the end of July.

The path to the deal

Paramount Skydance reached the agreement with Warner Bros Discovery in late February after months of negotiations and a rival bid from Netflix that ultimately fell short. The Ellison family, behind software billionaire Larry Ellison, took control of Paramount last year. David Ellison and other executives lobbied antitrust officials intensively, arguing the combined company would be better positioned to compete with larger streaming platforms such as Netflix, Amazon and Disney.

State-level opposition

Clearing the federal review does not end the legal scrutiny. A group of roughly ten states, led by California Attorney General Robert Bonta, is preparing a lawsuit to block the merger on antitrust grounds. Bonta's office opened an investigation in March and this week described the acquisition as remaining "the subject of an active investigation". The states could file their complaint as soon as this month, according to Bloomberg.

The acquisition of Warner Bros by Paramount remains the subject of an active investigation.

Political and industry unease

Critics in Hollywood have voiced "unequivocal opposition", fearing mass job losses, reduced film and series output and further consolidation in an industry already controlled by a handful of players. Thousands of actors, directors and writers signed statements against the deal. Political concerns also surround CNN, which would fall under the control of the Ellison family, known as allies of President Donald Trump. Trump critics worry the cable news network, often critical of the president, could lose editorial independence.

CNN could lose editorial independence under Paramount's roof, as has happened in other cases where media outlets were bought by billionaires loyal to the president.

International and next steps

While the US federal antitrust hurdle has been removed, competition reviews are still underway in Europe and other jurisdictions outside the United States. Paramount said it is working with regulators abroad and remains focused on completing the merger swiftly. If consummated, the deal would reshape the American entertainment landscape, merging storied film libraries that include the DC superhero universe, Harry Potter and the HBO catalogue with Paramount's assets.