Paramount’s $111 billion merger with Warner Bros. Discovery has cleared its final legal hurdle after a federal judge approved the company’s settlement with twelve state attorneys general. According to Deadline, U.S. District Judge Araceli Martínez-Olguín approved the September 21 consent decree, finding that it represented a “reasonable factual and legal resolution” of the antitrust dispute.
The decision allows Paramount to move forward with closing the massive transaction after months of legal challenges. Martínez-Olguín had delayed approval for more than a week to allow critics to submit opposition briefs. In her ruling, she acknowledged that the settlement may leave some parties dissatisfied but said compromise avoids the risks, costs and time associated with taking the case to trial.
California Attorney General Rob Bonta led the group of twelve attorneys general that sued Paramount in July. The lawsuit raised antitrust concerns involving cable programming, wide-release movies and blockbuster films.
A trial was scheduled for March before the two sides reached a settlement. Bonta welcomed the court’s approval while maintaining his reservations about the merger, saying the agreement addresses the state’s antitrust concerns while protecting competition, amid Paramount’s threats to leave California.
Block the Merger, which unsuccessfully sought to delay approval, continued criticizing the agreement following the ruling. The organization argued that allowing the companies to combine without significant structural remedies could hurt jobs, creative work and independent journalism.
Under the settlement, Paramount will face several legally enforceable commitments for five years after the transaction closes. Those include requirements involving theatrical film releases, separate negotiations with distributors for Paramount and Warner Bros. Discovery cable networks, and an editorial oversight board covering CNN and CBS, but they exclude major structural remedies such as selling off assets.
Paramount is expected to move quickly. CEO David Ellison previously estimated that formally combining the companies would take around two weeks. Beginning October 1, Paramount faces a roughly $7 million-per-day fee payable to Warner Bros. Discovery shareholders until the deal closes.
The company has already begun preparing financially, including marketing a $44 billion bond offering to help fund the acquisition alongside equity financing. Warner Bros. Discovery shareholders will receive $31 per share under the transaction.
Leadership changes are also beginning ahead of the combination. Paramount Direct-to-Consumer chair Cindy Holland departed this week, while Mattel chairman and CEO Ynon Kreiz was named Paramount co-CEO alongside Ellison.
