Court approves postponement of $100 billion+ merger between Paramount and Warner Bros. until 2027

A federal judge in California approved on Friday the request by Paramount Skydance to delay its merger with Warner Bros. Discovery (WBD) until June 2027. The decision comes amid a lawsuit filed by 12 states warning of potential risks to competition.

Judge Araceli Martínez-Olguín approved Paramount's commitment not to acquire Warner Bros. until a final ruling is issued or, at the latest, until the new deadline.

The plaintiff states—Arizona, California, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon and Washington, all governed by Democrats—argued that allowing the deal to close early could cause "irreparable harm."

Judge acknowledges risks to competition

The deal, valued at $110 billion and announced in February, provided for a penalty of 25 cents per Warner Bros. share per quarter (about $630 million) if it was not completed by the original deadline. When asked by AFP about a possible waiver of that fine, WBD referred the question to Paramount Skydance, which did not respond.

On Monday, the same judge had ordered a temporary stay of the deal, just two days before the European Union (E.U.) granted conditional approval. Although she did not rule on the merits of the case, Martínez-Olguín acknowledged that the states presented "solid evidence" that the transaction would substantially reduce competition.

New York Attorney General Letitia James welcomed the ruling: "Halting this merger while our case proceeds is a critical victory in our efforts to uphold the law and protect the film and television industries."

Paramount welcomes ruling, defends merger

Paramount called the decision a "significant win," as it provides "a direct path to a trial based on the evidence."

"This is the fastest and clearest way to prove that this transaction is good for competition, good for consumers, and good for creators," the company said in a statement sent to AFP.

The Trump administration had authorized the mega-deal on June 12 without imposing any modifications. If the deal goes through, the resulting company would hold a vast portfolio of media assets, including CNN, Warner Bros. Pictures and streaming platform HBO Max.