Paramount to settle lawsuits, paving way for Warner Bros. takeover

Paramount Skydance has reached a settlement with California and 11 other states, a crucial step in finalizing the $110 billion acquisition of Warner Bros Discovery, according to a source. This settlement marks one of the final hurdles before the deal, which aims to reshape Hollywood, can be completed. The agreement includes the formation of independent editorial boards for CNN and CBS, intended to protect the news operations' independence under the combined entity.

Additionally, the settlement mandates a $30 million penalty for every film not released within Paramount's annual 30-film pledge. Paramount Skydance and Warner Bros Discovery have yet to respond to Reuters' requests for comment on the settlement. Upon approval, this merger will unite Paramount's two of Hollywood's biggest film studios, two major streaming services, and two of the largest cable-news operations under one ownership.

Initially, reports suggested the settlement could finalize as soon as the weekend, with discussions around independent content monitoring for CNN and the commitment to release 30 films annually. The Wall Street Journal reported earlier this week that both parties had explored various concessions, including a $1.5 billion investment in production in the state, a promise not to sell either studio lot, and potential penalties if Paramount fails to honor its pledge.

Despite facing opposition from a coalition of 12 state attorneys general, led by California's Rob Bonta, who argued the merger would reduce competition and create a media conglomerate with unchecked power over movie and TV prices, the merger has cleared the Trump administration's regulatory hurdle. Other countries, such as the European Union and Britain, have already approved the acquisition.