Paramount and California Attorney General Advance Settlement Talks Over Warner Bros. Deal

Paramount Pictures and California Attorney General Rob Bonta have entered confidential settlement talks that could resolve the antitrust lawsuit challenging Paramount's planned $111 billion acquisition of Warner Bros. Discovery, sources said on Friday. The dispute, filed by Bonta and 11 other state attorneys general, has threatened to block the merger, which would combine assets such as HBO, CBS, CNN, Comedy Central, Food Network and the film and television studios of both companies.

Paramount CEO David Ellison is reportedly eager to settle before Oct. 1, when the company would face an additional $7 million daily payout to Warner Bros. Discovery shareholders on top of the $81 billion already committed. A spokesperson for Bonta’s office declined to confirm the existence or details of the talks, stating that settlement discussions are confidential.

Industry analysts note that a resolution would allow Paramount to avoid taking on further debt for the highly leveraged transaction, which already involves about $80 billion in financing. Both parties have expressed a willingness to compromise; a recent report said they have discussed keeping the Paramount Pictures and Warner Bros. film studios separate for a period after the merger rather than merging them immediately.

Warner Bros. Discovery shares rose 8 percent in after-hours trading following news of the negotiations, while Paramount stock gained more than 7 percent. The merger, which could reshape the entertainment landscape, has faced criticism for its potential impact on employment, with a Los Angeles County report estimating the loss of at least 4,500 jobs.