Paramount Skydance Completes $111 Billion Warner Bros. Discovery Merger

Paramount Skydance has completed its $111 billion merger with Warner Bros. Discovery after a last-ditch effort to block the deal was rejected by Supreme Court Justice Elena Kagan.

New company will operate under the Skydance name

The combined company will be called Skydance, named after the company Paramount acquired in a separate deal last year.

The merger brings together two of the largest movie studios, streaming services Paramount+ and HBO Max, CBS, CNN, “a portfolio of live sports including CBS Sports and TNT Sports, and a deep programming library and extensive collection of brands and franchises,” Skydance said in its announcement of the transaction’s completion.

Merger faced antitrust challenges from California and other states

The merger was briefly delayed by lawsuits filed by California and 11 other states. In July, US District Judge Araceli Martinez Holguin of the Northern District of California ruled that the combination significantly reduced competition and was likely to violate antitrust laws.

California settled the lawsuit last month, and the other states involved also agreed to compromise. A coalition of free speech and media advocacy groups asked the judge to reject the settlement, arguing that it would give “virtually nothing” to residents of the states that sued Paramount.

Judge approves settlement addressing film and cable distribution

Martinez Holguin approved the settlement on September 30, saying that the agreement “represents a reasonable factual legal resolution of the dispute.”

She wrote that a typical settlement “does not completely cure the alleged violation and does not necessarily resolve the ultimate factual and legal issues in the case.” Instead, it “reflects a compromise of the claims leading up to a full judgment. While a compromise may leave some frustration on both sides and the public, it is a compromise that saves the risk, time, and expense of litigating the case through the courts.”

The settlement addresses complaints about film distribution “by requiring certain minimum standards for the investment and release of domestic films,” the judge wrote. It also addresses complaints about basic cable channel licensing by “requiring continued and separate negotiations regarding the distribution of the companies’ basic cable holdings.”

“Objections based on hopes or desires that the proposed consent decree go further—that is, accomplish more—do not rise to the level of a violation of law that would allow the court to reject the parties’ negotiated settlement,” she wrote.