PSKY reaches settlement with state coalition, paving way for WBD deal to close

Paramount Skydance (PSKY) is set to close its US$110bn acquisition of Warner Bros Discovery (WBD) after it reached a settlement with the 12-state coalition looking to block the deal on antitrust grounds.

The lawsuit was the final regulatory clearance needed to complete the mega-merger, which will bring together PSKY assets like CBS, Paramount+ and Paramount’s film and TV studios with WBD’s HBO, HBO Max, CNN and a suite of factual cablenets.

The settlement comes after the state coalition, led by California attorney general Rob Bonta, was reported to be in advanced negotiations with PSKY last week. The two sides then continued negotiating over the weekend before finally closing the settlement agreement today.

Specific details of the arrangement have not yet been revealed, though potential remedies being discussed previously included PSKY selling off some cable networks, independent content monitoring of news network CNN and ironclad commitments to releasing 30 theatrical films a year.

The settlement comes 10 days before the “ticking fee” was set to come into force, on October 1. Under that deal provision, PSKY would have had to pay and additional US$0.25 per share per quarter (roughly US$7m per day or US$650m per quarter) if the deal did not close by September 30.

PSKY has repeatedly argued that its acquisition of WBD is pro-competitive and will create a scaled player that can go head to head with Netflix and the other tech giants involved in the content space.

The antitrust lawsuit was the final step in bringing the deal to fruition, after PSKY obtained approvals with more than 65 jurisdictions and regulatory bodies globally.

More follows.