European Union Clears Paramount and Warner Deal Under New Conditions
NEW YORK — The European Union approved Paramount’s $81 billion takeover of Warner Bros. Discovery this week, clearing another regulatory hurdle for a merger that could reshape the entertainment landscape worldwide.
The European Commission, the EU’s antitrust enforcer, said enough competitors would exist across film production and streaming markets. However, it warned of high concentration in theatrical film distribution that could lead to “worse rental and distribution terms for cinema operators.”
To address this, Skydance-owned Paramount agreed to end its European stake in United International Pictures, a venture with Universal, within 13 months of closing the deal. Paramount also agreed not to enter new agreements with Universal for the next 10 years.
Paramount welcomed the approval, calling it “a major milestone” toward completing the acquisition. A combined Paramount-Warner would bring HBO Max, “Harry Potter,” and CNN under the same roof as CBS, “Top Gun,” and Paramount+.
The merger faces other challenges. A federal judge on Monday ordered the companies to pause the transaction for at least two weeks due to a lawsuit from California and 11 other states seeking to block the deal. The deal is set to be halted until a preliminary injunction hearing on August 3.
Paramount has received clearances from Australia, China, and Canada, while UK review remains in progress. The company faces ticking fees of about $7 million per day if the deal isn’t closed by September 30. The transaction is valued at nearly $111 billion including debt.
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