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Paramount has agreed not to close its $111 billion takeover of Warner Bros. Discovery until the court decides whether the deal violates antitrust laws
The studio, in a court document filed on Friday alongside the coalition of states looking to block the merger, said it will hold off on consummating the acquisition until June 2027 or five days after the court issues a ruling on the case, whichever is earlier
In a statement, a Paramount spokesperson said the agreement provides a “direct path to a trial based on the evidence.”
“This is the fastest and clearest way to prove that this transaction is good for competition, good for consumers, and good for creators, a conclusion dozens of competition authorities around the world have already reached,” the spokesperson added. “Plaintiffs’ market definitions bear no relationship to the realities of today’s marketplace and cannot withstand scrutiny. We look forward to proving our case at trial.”
For Paramount, the delay in closing the deal may prove costly. Under the merger agreement, Warners shareholders are owed roughly $650 million per quarter or $6.9 million per day if the deal isn’t done by Sept. 30
The truce comes a day after U.S. District Judge Araceli Martínez-Olguín issued an extension of a temporary restraining order barring Paramount from closing until Aug. 18 at the earliest
Both sides are jockeying for an edge in preliminary injunction proceedings. Paramount had asked the court to hold a three-day evidentiary hearing next month, which the states opposed. The studio has maintained that the states’ understanding and calculation of the markets in the case are faulty
In Friday’s filing, both sides agreed to cancel an Aug. 3 preliminary injunction hearing. They’ll file a joint statement of their respective cases regarding the scheduling of the trial by July 31
The states alleged in its lawsuit that the acquisition will substantially throttle competition in wide-release and top-grossing theatrical distribution and cable licensing in violation of antitrust laws. Separately, the Writers Guild of America claimed that the merger will result in lower compensation and worse deal terms
