The United Kingdom has approved the proposed $110 billion merger between Paramount and Warner Bros. Discovery, with the government stating it received assurances regarding editorial independence and media diversity. The U.K.'s antitrust authority announced Thursday that it would not further investigate the deal, following assurances from Paramount about maintaining distinct editorial identities and independence for news services.
Paramount, led by CEO David Ellison, has offered to make these assurances legally binding. This decision comes after British actors, including Benedict Cumberbatch, Alan Cumming, and Benedict Wong, urged the U.K. government to block the merger due to concerns about the livelihoods of British film and TV crews, independent film financing, and the consolidation of news publications.
The U.K.'s clearance follows a similar approval from the European Union last month, which was contingent on Paramount exiting a joint venture with Universal Pictures in the region and meeting other conditions.
Despite these international approvals, the merger faces significant challenges in the United States. Paramount initially aimed to complete the deal by the end of September but is currently involved in lawsuits filed by 12 U.S. state attorneys general and the Writers Guild, both seeking to block the transaction. Paramount agreed to pause the merger process, and a trial is currently scheduled for March.
The delay is projected to cost Paramount millions, potentially billions, of dollars. The merger agreement includes a clause requiring Paramount to pay Warner Bros. Discovery shareholders approximately $7 million for each day the deal remains unclosed after September 30. A March trial date suggests these accumulated fees could exceed $1 billion before a ruling.
Paramount has stated that the decisions by the U.K. and E.U. highlight the perceived flawed market definitions used in the U.S. antitrust complaint. The company asserts that the combination of Paramount and Warner Bros. Discovery will enhance consumer choice and create a media entity capable of competing with dominant tech companies in the industry.