GoKawiilCalifornia and Paramount Skydance have reportedly reached a settlement allowing the company to complete its $111 billion merger with Warner Bros. Discovery. The settlement, which will reportedly be announced later today, drew condemnation from Democrats and media advocates.
“The Paramount/Warner Brothers merger seems facially illegal, and the state AG lawsuit challenging it is very strong,” Lina Khan, who chaired the Federal Trade Commission during the Biden administration, wrote yesterday. “It’s troubling to hear that the states may now settle for behavioral remedies, allowing the deal to go through subject to various promises from the firms. Behavioral remedies routinely fail, and the stakes here are particularly high given that a strong democracy requires open markets for sound journalism and creative expression.”
After news of advanced settlement talks was reported over the weekend, Bloomberg reported today that Paramount reached an agreement with California and other states that sued to block the merger. “Settlement talks came to fruition over the weekend after four states that had opposed terms of a deal outlined with California conceded,” Bloomberg wrote, citing a person familiar with the matter.
The New York Times reported the deal a bit later, saying that “four people familiar with the negotiations” confirmed it. The settlement was also confirmed in a Wall Street Journal report that said “the combined company is set to emerge with nearly $80 billion in debt—a substantial burden already expected to weigh on its investments in the business.”
Advocates unhappy with California AG
Media advocacy group Free Press criticized California Attorney General Rob Bonta. “We are disappointed that Attorney General Bonta went back on his promise to enforce the law and protect consumers and workers,” Free Press co-CEO Jessica J. González said. “Hundreds of thousands of people called on our state AGs to stand up to the Ellisons, who have engaged in a campaign of corruption and extortion to pave the way for this unlawful merger.”