LONDON — Paramount Skydance has cleared a key UK regulatory hurdle for its proposed $110 billion acquisition of Warner Bros. Discovery after British authorities approved the transaction, removing a significant obstacle to the deal’s planned completion.
The UK approval, announced on Aug. 6, followed months of scrutiny over the merger’s potential impact on competition, media plurality, news and children’s programming. The decision comes after the Competition and Markets Authority (CMA) opened a formal merger inquiry in June.
Paramount, which already owns UK broadcaster Channel 5, had faced additional scrutiny from the Department for Culture, Media and Sport. Culture Secretary Lisa Nandy said in June that she was minded to intervene in the transaction because of concerns over the concentration of media ownership, particularly in children's content, news and streaming.
The companies subsequently provided assurances concerning their UK operations, helping address the government's concerns about media plurality. Paramount has said it intends to preserve the distinct editorial identity of its UK services and maintain commitments relating to its broadcasting operations.
The transaction would combine Paramount's film and television assets, including Paramount Pictures, CBS and Paramount+, with Warner Bros. Discovery's Warner Bros. studio, HBO Max, CNN and a large portfolio of television networks and sports properties. Warner Bros. Discovery shareholders approved the transaction in April, with Paramount offering $31 per share in cash.
The UK clearance follows approval from the European Commission in July. The European Union's approval included commitments addressing competition concerns in film distribution, while Paramount has also received competition or investment clearances in numerous other jurisdictions.
The UK decision nevertheless does not remove all obstacles to completion. In the United States, Paramount faces an antitrust lawsuit brought by California and 11 other states seeking to block the transaction. A U.S. judge has paused the merger while the litigation proceeds. Paramount is also considering strategic options, including a potential sale of CNN, in an effort to resolve the U.S. dispute, the company's chief legal officer Makan Delrahim said this week.
Paramount has targeted completion of the Warner Bros. Discovery acquisition in the third quarter, subject to remaining legal and regulatory requirements.
