Lawsuits from state attorneys general and the Writers Guild of America have forced Paramount Skydance to put its takeover of Warner Bros. Discovery on ice, with the company now agreeing not to close the $110 billion deal until an antitrust trial concludes or June 1, 2027 arrives, whichever comes first.
The delay could push the combination of two of Hollywood’s biggest studios years beyond its original target.
The commitment, laid out in a Friday afternoon court filing, scraps Paramount’s plan to take control of Warner Bros. Discovery by the end of September.
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At the center of the dispute is a coalition of 12 state attorneys general, led by California’s Rob Bonta, contending that the tie-up would reduce competition and hurt consumers. A parallel challenge came from the Writers Guild of America.
The current merger agreement expires on March 4 and carries an automatic extension running through June 4, 2027. Earlier in the week, Judge Araceli Martínez-Olguín had granted a temporary restraining order that placed a 14-day pause on the deal. Rather than fight a preliminary injunction, Paramount chose to bypass that stage and press for a fast jury trial. An executive involved in the matter told CNN that the company’s lawyers had concluded the plaintiffs would likely prevail at the injunction stage.
Dragging the timeline out carries a steep price. The merger terms require Paramount to pay Warner Bros. Discovery shareholders a 25-cent-per-share “ticking fee” for each quarter the transaction stays open after September 30. At roughly $650 million in cash value per quarter, a delay reaching June 2027 could tack about $1.7 billion onto the deal price.
Abandoning the transaction altogether would trigger a $7 billion breakup fee.
Paramount described the outcome as a “significant win,” saying the result delivers “a direct path to a trial based on the evidence” and arguing that the plaintiffs’ market definitions “bear no relationship to the realities of today’s marketplace.”
