Champagne reportedly flowed at Paramount Skydance headquarters late last week after the media conglomerate edged out Netflix to acquire the entirety of Warner Bros Discovery for a cool $110bn.
And on a call with analysts and investors on Monday morning, David Ellison, Paramount Skydance’s chief executive, said the company was “absolutely confident” that the merger will expeditiously pass regulatory muster both in the US and abroad.
“We’ve been engaging with regulators around the world and the combination does not come close to hitting any of the metrics that would be problematic,” Ellison said.
But the deal, which drew outraged statements from many Democratic members of the US Senate, doesn’t necessarily have a glide path to closing, antitrust and competition experts say. While Congress does not have any power to stop the merger, a state attorney general – or a coalition of attorneys general – could sue to block the deal, which could put the matter in front of a judge.
“I definitely think they have a shot at stopping it if they pool their resources to make a challenge,” Alvaro Bedoya, who served on the Federal Trade Commission between 2022 and 2025, said in an interview.
In that vein, Rob Bonta, California’s attorney general, said in a post on X that he was “in conversation” with fellow state attorneys general.
“Paramount/Warner Bros is not a done deal,” Bonta said in a statement after the deal was announced. “These two Hollywood titans have not cleared regulatory scrutiny – the California Department of Justice has an open investigation, and we intend to be vigorous in our review.” (Bonta, who was not made available for an interview, did not provide any further comment.)
“A combined lawsuit by state attorneys general presents a real threat,” Bill Baer, who served as assistant attorney general in charge of the antitrust division of the US Department of Justice from 2013 to 2016, told the Guardian. “It’s harder for them to prevail if [the justice department] has said [the merger] is fine, but it’s not impossible. There are serious antitrust issues that in a normal world would involve further inquiry.”
The merger will also need to be approved by antitrust officials from the European Commission and the United Kingdom – though competition and antitrust expert Cristina Caffarra said she didn’t expect that to be an issue, particularly because she sees little willingness to antagonize Donald Trump, who is a strong supporter of the Ellison family and its deal.
“This deal is not particularly significant to anyone in Europe,” she said. “There isn’t the prospect of lost jobs, like in California. Even on conventional grounds, this would likely be waved through in Europe. They care even less in a Trump administration in which the outcome is foretold.”
As for the process in the UK, Caffarra claimed the country’s “competition authority has been decapitated” – and is far more focused on promoting growth than regulating competition.
By combining the HBO Max and Paramount+ streaming services, as Ellison announced Monday, the deal could reasonably be seen as reducing competition in the marketplace – though the company has said it would “maintain” both the Warner Bros and Paramount film studios.
“I think there’s an argument that this will create a very concentrated market for a very specific kind of movie studio that puts out a very particular kind of movie,” Bedoya, the former FTC commissioner, said. “There appears to be an even more compelling case that a whole lot of people are going to be put out of work. So I think a state attorney general looking at the labor market effects is going to have something to work with.”
The combined company will also be saddled with $79bn in debt, and will surely make significant efforts at cost-cutting that are expected to include employee layoffs. The Writers Guild of America put out a statement last week opposing the deal, saying the merger “must be blocked” because “the loss of competition would be a disaster for writers, consumers and the entire entertainment industry”.
Some US senators have made similar arguments. “If Paramount Skydance’s deal with Warner Bros. goes through, one family will become a dominant force in American entertainment, with David Ellison owning Warner Bros., Paramount+, HBO, CBS News, CNN, TNT, TBS, Food Network, Discovery Channel, Animal Planet, HGTV, and more,” US senators Elizabeth Warren and Richard Blumenthal wrote in a letter to Pam Bondi, the US attorney general, on Monday. “Federal antitrust law is designed to prevent mergers that would create massive conglomerates like this, which are bad for our economy and for Americans.”
A justice department spokesperson declined comment on the status of the agency’s regulatory process, though Bloomberg News reported that the deal “remains under active review by US antitrust officials”.
“We will work incredibly collaboratively with regulators to ensure that we get a quick path to closing and are confident in our ability to achieve that goal,” Ellison said Monday.
Although it was not the leading bidder, with Warner Bros Discovery’s board initially backing Netflix’s offer, Paramount has already completed at least two information requests from the Department of Justice. Because the 10-day waiting period mandated by the Hart-Scott-Rodino Antitrust Improvements Act of 1976 expired on 19 February, Paramount said last month that “there is no statutory impediment in the U.S. to closing Paramount’s proposed acquisition of WBD”.
While Baer said it appeared that Trump’s Department of Justice was leaning toward approving the deal, and the process is certainly a few steps along already, “they’ve got authority to issue civil investigative demands and require more information from both parties” now that the deal has been finalized.
“I think there is a substantial risk that the closing of the transaction is delayed,” he said.