The U.S. Department of Justice's Antitrust Division has given the green light to Paramount Skydance’s $111 billion acquisition of Warner Bros. Discovery (WBD) after an extensive eight-month review. DOJ officials determined that the deal would not harm competition across multiple markets, including streaming video on demand, linear television, and theatrical film production and distribution. Their decision followed a comprehensive investigation involving over two million documents, numerous depositions, and coordination with state attorneys general.

Warner Bros. Discovery, which owns major studios, CNN, and HBO Max, is poised to join forces with Paramount Skydance to create a streaming service reaching around 200 million subscribers. Paramount executives, including CEO David Ellison, actively engaged with DOJ officials during the review process, arguing that the merger would bolster competition against tech giants and rival streaming platforms. Paramount expects the merger to generate more than $6 billion in synergies within three years, mostly from non-labor areas, while critics in the entertainment industry are concerned about potential layoffs and market consolidation.

The merger received approval from WBD shareholders on April 23, with WBD’s board chair Samuel A. Di Piazza Jr. expressing optimism about the combined company’s potential to expand consumer options and support creative talent globally. However, a group of Paramount subscribers has filed a lawsuit in federal court challenging the merger, claiming it would reduce competition and allow the new company to control nearly a quarter of the theatrical distribution market. Paramount has dismissed the lawsuit as baseless, maintaining that the merged company will enhance consumer choice and competition.

Before the deal's approval, Paramount and Netflix engaged in a high-profile bidding war for Warner Bros. Discovery, with Netflix initially proposing $82.7 billion and Paramount countering with a higher bid of around $108.4 billion, later raised to $111 billion. Netflix ultimately declined to increase its offer, viewing the financial terms as unattractive. WBD CEO David Zaslav called the merger historic and valuable for shareholders, emphasizing that the new company would be a leading force in a rapidly consolidating entertainment industry facing fierce streaming competition.