Court extends block on Paramount-Warner Bros. Discovery merger to August 17

A California court has extended the prohibition on the Warner Bros. Discovery merger with Paramount, delaying the transaction until August 17. This decision comes as the $110 billion deal faces scrutiny from 12 U.S. states.

The court's ruling extends the existing injunction, which was initially set for two weeks. A significant hearing is scheduled for August 3, where a decision may be made regarding whether the transaction will remain suspended throughout the ongoing legal proceedings initiated by the states. Paramount Skydance reportedly seeks a three-day evidentiary hearing to present arguments that the acquisition is essential for competition in Hollywood.

Meanwhile, the European Commission granted conditional approval for the merger on July 22. The conditions primarily concern the film distribution market, requiring Paramount to sell its stake in the joint venture with Universal Pictures (UIP) within 13 months of the transaction's closure. Paramount will also be restricted from jointly distributing films with Universal in the European Economic Area or transferring Warner Bros. productions to distributors also handling Universal or Disney films in specific markets, including Poland.

In Poland, the finalization of the merger requires government approval for Paramount to gain control of TVN Group, the broadcaster of TVN channel and other related media. The ongoing delays are costly, with Bloomberg reporting that each day of delay incurs $7 million for Paramount. If the deal collapses due to antitrust concerns, either party can withdraw starting June 1, 2027, at which point Paramount would owe WBD an additional $7 billion.