Things are heating up when it comes to the Paramount Skydance acquisition of Warner Bros. Discovery. Yesterday, a dozen attorneys general filed a lawsuit to stop the merger. On the same day, the Writers Guild of America West and Writers Guild of America East also filed a lawsuit to block the proposed merger.
In the complaint, the WGA states the merger would reduce opportunities, lower pay, and worsen working conditions for writers. They also state the merger would reduce output as well as suppress competition for writers’ work.
The WGA complaint focuses on the anticompetitive effects of the merger in three markets for writing services: anticipated top grossing films, episodic television and streaming series, and overall deals.
In June, the White House and the Department of Justice approved the merger. Oregon has been investigating Paramount Skydance’s “Project Warrior” which was focused on winning approval for the deal. They recently withdrew motions regarding their own lawsuit. It’s unknown if they’ll continue to pursue that as they are a part of antitrust lawsuit by the attorneys general.
Paramount Skydance still faces a hurdle in the European Commission and the U.K. The company has attempted to address EU competition concerns such as ending a film distribution venture it has with Universe Pictures. The European Commission has extended its deadline for its decision from July 7 to July 22.
Paramount Skydance wants the deal to close before September 1, 2026 or the cost will increase the longer it drags on. The price increases 25 cents per share per quarter it’s not approved. That would add $627 million to the cost of the overall deal each quarter, or roughly $7 million per day. This lawsuit will likely drag on for months if it moves forward making it unlikely the deal will close by that date. The company has said delays could force it to renegotiate the deal’s financing, cause uncertainty for its stock price, or end the the transaction altogether.
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Source: Graphic Policy
