The European Commission has approved the $110 billion merger between Paramount Global and Warner Bros. Discovery. The approval was granted after Paramount agreed to terminate its joint venture with Universal Pictures for film distribution in Europe within 13 months. Under the agreement, Paramount is prohibited from entering a similar distribution partnership for the next 10 years.
While the deal has cleared European regulatory hurdles, it remains stalled in the United States due to legal challenges. Last week, a coalition of 12 U.S. states filed a lawsuit to block the merger, alleging the consolidation would harm movie theaters, cable distributors, and consumers. In response, U.S. District Judge Araceli Martínez-Olguín issued a temporary restraining order to pause the transaction while the court evaluates the claims.
The merger also faces opposition from the Writers Guild of America, which argues the combined entity would have excessive power to reduce wages and limit employment opportunities. Conversely, Paramount has stated the merger will benefit the public by increasing its output to 30 theatrical film releases per year.
The companies face financial pressure to finalize the deal. If the merger is not completed by September 30, Paramount must pay Warner Bros. shareholders a daily fee of approximately $7 million until the transaction closes. Additionally, regulators in the United Kingdom are currently reviewing the deal to assess its potential impact on local news, streaming competition, and children's programming.