The Justice Department has cleared Paramount‘s $111 billion megadeal for Warner Bros., a key approval that removes a major regulatory roadblock to completing the merger that will reshape Hollywood.
The acquisition will “increase competition across the media and entertainment ecosystem,” the Justice Department’s Antitrust Division said in an announcement on Friday. The agency found that markets for streaming, linear TV and the development, production or distribution of films for theatrical release will not be harmed.
The decision clears the way for Paramount to become the largest theatrical distributor in the country and own a top five streamer by subscriber count unless the merger is stopped by another entity.
“We are grateful for the Department of Justice’s thorough review of this transaction, as well as the work of the other agencies that have completed their reviews and provided clearance to date,” a Paramount spokesperson said in a statement. “This deal is pro-competitive, resulting in a stronger company better positioned to compete against dominant technology platforms in an industry increasingly defined by intense competition for audiences, talent, technology, and investment.”
The green light doesn’t appear to require any divestitures, behavioral remedies or concessions.
The Justice Department is one of several groups that posed an obstacle to consummating the merger. They include state attorneys general, the FCC, the European Union and consumers, who’ve already filed a lawsuit to stop the acquisition.
Paramount has framed the deal as one that will boost competition in Hollywood, arguing it’s necessary to compete against tech giants like Netflix, Amazon and Apple.
The Justice Department ultimately agreed with Paramount’s posture on the merger. “In technology-driven industries, the disruptors of the recent past may quickly become the entrenched monopolists of the present day,” it said. “It is with this historical experience and present enforcement sensitivity to the contestability of dynamic markets that the Division conducted a thorough investigation of the proposed transaction to assess whether the proposed transaction presented any harm to competition.”
As the Justice Department weighed approval, a coalition of states led by California are preparing a lawsuit to block the deal that’s expected to be filed within a month. New York, Colorado, Oregon, Nevada, Washington, Connecticut and Tennessee are among the several states in talks to join, a source familiar with the situation told The Hollywood Reporter.
In a post on X, Sen. Elizabeth Warren (D-Mass.) urged state attorneys general to follow through on challenging the merger.
“This is terrible news for every American who doesn’t want Trump-aligned billionaires to control what they watch and how much they pay,” she said. “The Paramount-Warner Bros. deal has reeked of corruption and influence-peddling. This fight isn’t over.”
So far, regulators in Saudia Arabia, Ukraine, Serbia and North Macedonia have found that the deal doesn’t violate antitrust laws, posted Paramount legal chief Makan Delrahim. Foreign Direct Investment authorities in Germany, Italy, France, Romania, Slovenia, Belgium, Czechia and New Zealand have also cleared the merger.
“We remain focused on completing the transaction as soon as possible and delivering its benefits to consumers, creators, and the entertainment industry as a whole,” Paramount said in a statement.
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