US DoJ backs bond demand in Paramount-Warner Bros antitrust fight

On Tuesday, the U.S. Justice Department advised a federal court to compel states seeking to impede Paramount Skydance's $110 billion acquisition of Warner Bros Discovery to post a bond, ensuring financial responsibility for any delays in finalizing the deal. The Justice Department stated in a California court filing that entities pursuing a preliminary injunction under federal antitrust law must submit a bond to cover potential losses if the injunction is later invalidated.

This development comes as a 12-state alliance, spearheaded by California, aims to halt the transaction, contending that the merger would forge a media colossus capable of inflating prices in film and television sectors. The Writers Guild of America has also initiated legal action to contest the deal. In the preceding month, Paramount requested a U.S. judge to mandate the states to post a $1.88 billion bond.

Paramount is obligated to pay a daily fee of $7 million should the acquisition conclude beyond September 30. The trial is slated for March, and by the time a ruling is delivered and final briefs are submitted in April, Paramount would have disbursed Warner Bros. shareholders $1.3 billion in non-refundable ticking fees.