Paramount is halting the Warner Bros merger till June 2027.
It will be pausing the deal until legal challenges resolve.
Several noted actors have warned of the severe implications if the merger were to go through.
Paramount Skydance has conceded to pause its $110bn acquisition of Warner Bros Discovery until a ruling on several states’ challenge to the deal, or until 1 June 2027, as per court papers filed on Friday. Paramount is holding off until after an antitrust trial.
After a court filing spelling out the agreement came during the last hour of trading on Wall Street, shares in Paramount added to what was already a lackluster day. They dipped 3.3% on the day to finish at $8.21 after touching a 52-week low of $8.17. The stock slid another penny in after-hours trading.
Paramount-Warner Bros Merger
In a statement, Paramount said: “Today’s agreement is a significant win because the result is exactly what we have sought from the outset: a direct path to a trial based on the evidence.” It enumerated: “This is the fastest and clearest way to prove that this transaction is good for competition, good for consumers and good for creators – a conclusion dozens of competition authorities around the world have already reached … We look forward to proving our case at trial.”
U.S. District Judge Araceli Martinez-Olguin this week issued the states a temporary restraining order halting the transaction for 14 days to hold a hearing on whether to grant a lengthier preliminary injunction. She later extended the TRO by another 14 days, through August 17. Now both sides have suggested that they wish to schedule a trial. The states allege that the deal should be blocked because it will diminish competition in the cable and theatrical markets. Separately, the Writers Guild of America filed a lawsuit insisting that the merger will result in lower compensation and exacerbate deal terms.
California Attorney General Rob Bonta, in a statement on social media, called the agreement “a major victory for a free and fair economy, for the entertainment industry, for workers, for consumers, and for affordability.” He planned to share additional thoughts with the media at a Friday afternoon press briefing. The court will consider arguments on the motion on Aug. 3.
