Paramount's $111B Warner Bros. Deal Clears Antitrust Hurdle but Judge Delays Approval Amid Opposition

Paramount Global has cleared the final regulatory hurdle for its $111 billion acquisition of Warner Bros. Discovery by settling an antitrust lawsuit brought by a dozen state attorneys general, but the merger's immediate future remained uncertain Thursday after a federal judge postponed approval of the consent decree and demanded further arguments from the parties.

U.S. District Judge Araceli Martinez-Olguin declined to sign off on the settlement during a virtual hearing, instead instructing attorneys to address concerns raised in a six-page letter from Sen. Cory Booker (D-NJ) by a September 29 deadline. The judge stressed she would "get you a ruling in due course," according to Deadline, which reported that a $7 million-a-day ticking fee looms for Paramount beginning October 1 if the deal remains unclosed.

The settlement was announced Monday after California Attorney General Rob Bonta and 11 other mostly Democratic state attorneys general filed suit July 13 alleging the combination would violate the Clayton Antitrust Act. The deal would create a media behemoth controlling CBS, CNN, HBO, Paramount+, and thousands of film titles.

During the hearing, California Senior Assistant Attorney General Paula Blizzard argued the consent decree was "presumptively valid" and the result of "tens of hours" of negotiations, while acknowledging the merger "has engendered a large amount of controversy." She said the states were still prepared to take the matter to trial starting March 2, 2027, if the decree is not approved.

Judge Martinez-Olguin expressed concerns about whether the settlement "addresses the Clayton Act concerns" and whether the process was "not the result of collusion and was more of an arm's length process," according to Deadline.

**Emergency Motions and Opposition**

A coalition of advocacy groups — including Free Press, the Committee for the First Amendment, and the Future Film Coalition — filed an emergency motion Thursday seeking to formally oppose the consent decree. Judge Martinez-Olguin granted the motion, allowing opponents to submit briefs by midnight that evening.

"The consent decree the state AGs agreed to in a backroom deal is weak, unenforceable, and leaves workers, journalists, and consumers in the dust," the coalition said in a statement, as reported by Common Dreams. The group called the deal "dangerous for democracy."

Mara Verheyden-Hilliard, a constitutional rights litigator on the steering panel of the Committee for the First Amendment, said in a statement that the decree "fails to meaningfully address or mitigate the harms that will be caused by this monopoly merger to the entertainment industry, diverse storytelling, independent filmmaking, consumer interests, a free press, First Amendment rights, and fundamentally, democracy."

The Freedom of the Press Foundation characterized the settlement's proposed "News Editorial Independence Boards" for CBS and CNN — comprised of five "established journalists" — as "worthless" and a potential "First Amendment nightmare." Seth Stern, the group's chief of advocacy, said, "No one seriously believes the Ellisons (or their rumored new investor Elon Musk) will do that, with or without a self-appointed sham editorial board, which is why this merger cannot proceed."

The League of United Latin American Citizens and a group of religious leaders filed a separate motion asking the judge to defer entry of the decree, arguing it raises "grave doubts whether the parties' settlement adequately addresses the harms alleged."

**Debt Financing and Investment**

Despite the legal uncertainty, Paramount began syndication Thursday for a proposed senior secured term loan of $7.5 billion to help fund the acquisition, according to the company and reports from Deadline and Variety. The company said it intends to raise approximately $44.4 billion of additional secured debt, which together with cash on hand and previously announced equity financing will be used to fund the purchase price and repay certain existing debt.

Bank of America, Citigroup, and Apollo Global Management are underwriting the debt package, one of the largest ever, according to Deadline. Apollo partner Aaron Sobel, speaking at the Financial Times Business of Entertainment Summit, said the deal gives traditional media a fighting chance against Big Tech. "I don't think you can overstate how important getting that deal done was," Sobel said.

Larry Ellison, the Oracle co-founder and father of Paramount CEO David Ellison, has personally guaranteed over $40 billion in equity financing, with $46.7 billion reported by Variety. Sovereign wealth funds from Saudi Arabia, Qatar, and the United Arab Emirates have committed $24 billion and would own 38.5% of the combined company, according to Paramount.

**Potential Elon Musk Investment**

Paramount is also considering bringing Elon Musk on as an equity investor, according to a Semafor report cited by multiple sources. Paramount has not said how much it hopes to raise, and the size of any Musk investment remains undetermined. A Paramount spokesperson declined to comment.

The possibility sparked panic inside CNN, which is owned by Warner Bros. Discovery, according to Zero Hedge. One CNN source noted the "awkward timing" for California Gov. Gavin Newsom, who supported the merger. "When it rains... it pours," another source said, adding, "It's really scary given what he did at X and DOGE."

**Hollywood Insiders and Settlement Terms**

California Attorney General Bonta was secretly advised during negotiations by a consortium of Hollywood insiders led by Academy Award-winning producer Charles "Chuck" Roven (Oppenheimer, The Dark Knight), Page Six reported. A source close to Roven said the producer did not take a side but helped Bonta understand Hollywood's vernacular and financial underpinnings.

The settlement requires Paramount to release 30 films in theaters annually, rising to 32 after two years, with at least 20 wide releases. If targets are missed, Paramount must sell Miramax Studios and pay $30 million per shortfall. At least four independent films per year are required, and 20% of output must be "tentpole" films with budgets of at least $50 million and a wide release of 3,000 screens within four weeks.

Critics have noted that Paramount and Warner Bros. were already committed to releasing 35 films next year, and the defined terms leave significant wiggle room, according to one studio executive quoted by Page Six.

The merger is expected to close in about two weeks, pending the judge's approval — though Thursday's hearing and the ongoing opposition make the timeline uncertain.