Paramount Skydance's $110 Billion Warner Bros. Discovery Deal Remains Frozen in Legal Limbo

M&A · PartnershipRegulation Impact 4

โดย Insider Monkey·

Summary · why it matters

Paramount Skydance Corporation's roughly $110 billion deal to buy Warner Bros. Discovery remains frozen after the two companies agreed not to close it until five days after a trial verdict or June 1, 2027, whichever comes first. A coalition of 12 states led by California, plus the Writers Guild of America, sued to block the deal on antitrust grounds, and the judge overseeing the case has already signaled real doubts about its legality. Paramount owes Warner shareholders a $650 million ticking fee every quarter starting September 30 until the deal closes, and if it collapses entirely, Paramount owes a $7 billion breakup fee on top of the $2.8 billion it already paid Netflix to win the original bidding war. Paramount wants the trial to start in November 2026, while the states and the writers' union want April 2027. The deal has already cleared the Justice Department, the European Union, and China, along with 65 jurisdictions worldwide overall, according to CEO David Ellison, and Paramount hired litigator Beth Wilkinson, who previously beat state antitrust lawyers defending Microsoft's $75 billion Activision Blizzard purchase. However, Judge Araceli Martínez-Olguín has already written that the combined companies' market share alone lets the court presume the merger likely violates antitrust law, and Paramount's stock is down over 37% this year as of August 3, 2026, with the firm having already spent more than $160 million on legal fees linked to the bid. Warner Bros. Discovery had 94 hedge fund holders as of Q1 2026, up from 86 the quarter before, while Paramount had just 30 holders, down from 37.