A US federal judge has approved a settlement between Paramount and 12 states that had challenged the company’s planned acquisition of Warner Bros. Discovery, clearing the final major legal hurdle before the massive media merger can close.
US District Judge Araceli Martínez-Olguín approved the settlement on September 30, ruling that the agreement provided a reasonable way to address the competitive concerns raised by the states. The companies are now expected to complete the merger on October 6.
The acquisition will bring major entertainment and media properties under one corporate group, including Warner Bros. Pictures, HBO Max and CNN alongside Paramount Pictures, CBS and Paramount+. The transaction is valued at about $81 billion in equity, while its total value including debt has been estimated at roughly $111 billion.
The legal challenge was filed by 12 state attorneys general, led by California, who argued that combining the two companies could reduce competition in the US film and television markets.
Under the settlement, the combined company must release at least 30 films annually in US theaters for the next two years, followed by 32 films per year for the subsequent three years. Paramount also agreed to spend an additional $1.5 billion on US film production over five years.
The agreement also includes measures intended to protect workers affected by the merger. Paramount will provide $47.5 million over five years for workforce training and career-development programs, while additional commitments were made through a separate settlement with the Writers Guild of America.
Another major condition concerns the company’s news operations. Within 180 days after the merger closes, the combined company must establish a five-member News Editorial Independence Board made up of experienced journalists. The board will oversee specified editorial matters involving CBS News and CNN.
Paramount will also be required to negotiate certain basic cable agreements separately for Paramount-owned and Warner-owned channels during the five-year commitment period.
The settlement follows months of regulatory and legal scrutiny surrounding the acquisition. The 12 states initially sought to block the transaction, but agreed to settle their lawsuit on September 21 after Paramount accepted additional commitments.
Following the judge’s approval, Paramount also announced that Mattel Chief Executive Ynon Kreiz will join David Ellison as co-CEO of the combined company. Ellison will remain chairman and CEO, while Kreiz will oversee day-to-day operations and integration of the businesses.
The merger will unite two of Hollywood’s major legacy studios and place a broad collection of film studios, streaming services, television networks and entertainment franchises under the same corporate umbrella. The companies now have the court’s approval to proceed toward closing the deal next week.
