US gives green light for Paramount’s $111 bn Warner Bros. takeover

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The US Justice Department on Friday cleared Paramount Skydance’s $111 billion takeover of Warner Bros. Discovery, handing a major win to a media empire financed by one of President Donald Trump’s closest billionaire allies.

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The Antitrust Division approved the blockbuster deal without demanding a single change, capping an eight-month review and clearing the way for one of the largest media mergers in years.

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It said the tie-up was “not likely to result in harm to competition or American consumers” — and could even increase competition.

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The approval is a coup for Paramount chief executive David Ellison, whose father, Oracle co-founder Larry Ellison, largely financed the takeover.

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The elder Ellison, one of the world’s richest men, is a close ally of Trump.

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A group of Democratic senators led by Elizabeth Warren had warned that a Warner Bros. deal risked being “tainted by political favoritism and corruption,” urging the Justice Department to review it on the law and facts.

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Larry Ellison’s financial guarantee was what finally won over the Warner Bros. board, sealing Paramount’s victory in a bruising bidding war with Netflix.

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The combined company will control a sprawling roster of assets, including CNN, Warner Bros. Pictures and the HBO Max streaming service.

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But the federal sign-off does not end the deal’s legal peril.

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A coalition of about 10 states led by California is preparing an antitrust lawsuit that could land this month, Bloomberg has reported.

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California Attorney General Rob Bonta’s office said this week the acquisition “remains an active investigation.” The European Commission is reviewing the merger as well.

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Hollywood is uneasy about the deal.

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Hundreds of actors and directors have signed a letter opposing the merger, warning it will choke production in an industry already battered by years of consolidation and cost-cutting.

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The Justice Department pushed back on those fears directly, arguing the evidence did not show the merger would shrink output.

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The saga began last year, when streaming giant Netflix and Paramount went to war over Warner Bros. and its prized back catalog.

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A wary Tinseltown reluctantly lined up behind Netflix as the lesser of two evils, only to watch Paramount keep raising its bid until the streamer walked away.

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AFP

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