A US federal judge has authorized Paramount to proceed with its $110 billion acquisition of Warner Bros, ending a prolonged legal challenge over the merger. On Wednesday, US District Judge Araceli Martínez-Olguín approved a settlement with a coalition of 12 states led by California, which had contested the deal on antitrust grounds. The states expressed concerns that the merger could create a dominant media entity capable of controlling prices for films and television content.
Under the terms of the settlement, the combined company must release a minimum of 30 movies annually in US theaters for the next five years and invest an additional $300 million each year in domestic film and television production. Should the company fail to meet the theatrical release quota, it may be compelled to divest Miramax as stipulated in the agreement.
Despite opposition from several groups who urged the court to reject the settlement, arguing it insufficiently addressed antitrust issues, Judge Martínez-Olguín deemed the agreement a “reasonable factual and legal resolution.” She concluded that calls for further measures did not provide adequate legal justification to block the merger.
The California Department of Justice affirmed that the settlement effectively addresses antitrust concerns while protecting competition, consumer choice, and the interests of workers within the state. Additionally, the agreement mandates that Paramount and Warner Bros negotiate basic cable arrangements independently for their respective networks. A board composed of journalists will also be established to oversee CBS News and CNN operations.
In a significant leadership development tied to the merger, Mattel CEO Ynon Kreiz is set to join Paramount on October 5 and will assume the role of co-CEO upon the transaction’s completion. The companies announced in a joint statement that they anticipate finalizing the acquisition on October 6. Paramount has also resolved a separate antitrust lawsuit with the Writers Guild of America, agreeing to contribute $17.5 million to the guild’s health fund and to maintain staffing levels at CBS News for five years.
Kreiz, who has led Mattel since 2018, is credited with transforming the toymaker’s brands into successful films, TV shows, and games, including “Barbie,” Warner Bros’ highest-grossing film to date. His appointment provides Paramount chairman and CEO David Ellison, who has a creative background, with an experienced executive to manage daily operations and integration efforts. Kreiz’s prior experience includes co-founding Fox Kids Europe, leading Endemol, and running Maker Studios, which was sold to Disney in 2014. Paramount aims to achieve over $6 billion in savings from the merger.
