Just a few weeks after settlement talks completely fell apart, Paramount and California may finally be getting somewhere. A new report says the two sides are now closing in on a deal that could remove one of the biggest roadblocks to Paramount’s planned acquisition of Warner Bros. Discovery.
Last month, California Attorney General Rob Bonta publicly accused Paramount of negotiating in bad faith and canceled a scheduled settlement meeting, throwing the future of the lawsuit into even more uncertainty.
Now, things appear to have changed. According to The Wall Street Journal, Paramount and the coalition of states led by California are in advanced talks to settle the lawsuit challenging the proposed $111 billion Warner Bros. Discovery merger.
The reported agreement would allow Paramount to move forward without immediately combining the movie studios. Instead, the two companies would reportedly continue operating their film divisions separately for a period of time.
Reuters added another interesting detail. It was reported that a settlement could come as soon as this weekend. According to the report, the agreement could also include independent monitoring of CNN’s content and a commitment from Paramount to release a certain number of movies theatrically each year.
There are still a few hurdles to clear. Bonta has repeatedly said he wants structural remedies, which typically involve selling off parts of a business rather than simply making promises about how it will operate. So far, Paramount has mainly offered behavioral concessions, including commitments about theatrical releases instead of divestitures.
Nothing is official yet, either. A spokesperson for Bonta’s office declined to confirm the negotiations, saying settlement discussions are confidential. Paramount also declined to comment, and reports stress there’s no guarantee the two sides will ultimately reach an agreement.
Even then, the timing is significant. If Paramount can settle before October 1, it would avoid a $7 million-per-day ticking fee tied to the merger agreement. The company also received another boost this week after the FCC approved equity investments from several Middle Eastern sovereign wealth funds helping finance the acquisition.
A few weeks ago, this merger looked like it was heading toward an even uglier court fight. Now, it suddenly feels like the finish line might actually be in sight. There’s still work to do, but for the first time in a while, momentum appears to be moving in Paramount’s favor.
What do you think happens next with Paramount’s bid to acquire Warner Bros. Discovery? Let us know your thoughts in the comments below.
