Paramount Skydance has agreed to pause its mega-merger with Warner Bros. Discovery until five days after the antitrust cases are ruled on, or until June 1, 2027, whichever comes sooner, the company said on Friday.
Paramount is facing an antitrust lawsuit from 12 US states and a legal challenge from the Writers Guild of America.
This decision means Paramount will almost certainly head to court to defend its deal to acquire WBD, unless settlements are reached. That will likely mean a delay of months.
“Today’s agreement is a significant win because the result is exactly what we have sought from the outset: a direct path to a trial based on the evidence,” a Paramount spokesperson said in a statement.
The spokesperson continued: “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. 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.”
Shares of Paramount and WBD each fell sharply on the news. Paramount’s stock finished the day down 3.3% while WBD shares slid about 0.7%.
David Ellison’s media company had been hoping to close its WBD deal by mid-July.
With WBD, Paramount would control two top film studios in Paramount Pictures and Warner Bros. Studios; TV networks like HBO, CBS, and CNN; and streaming services Paramount+, Pluto TV, and HBO Max.
Paramount employees are torn about the WBD deal
Staffers at Ellison’s company have been on edge about the WBD deal and antitrust challenges.
Some told Business Insider they believed the deal would improve their job security as Paramount grew stronger, while others thought the merger would lead to overlap that could put their roles at risk.
“I’m definitely worried about impending layoffs post-merger,” one Paramount worker said. “But I’m worried about the company as a whole if it doesn’t go through.”
A pro-deal Paramount streaming employee said they “see Paramount in the same light as Spirit Airlines. Regulators didn’t let JetBlue and Spirit Airlines merge. Now Spirit is bankrupt, and JetBlue is struggling.”
A streaming staffer who didn’t like the deal said they were “tired of mergers and chaos.”
This story is developing. Check back for updates.
