Paramount’s proposed takeover of Warner Bros. Discovery moved much closer to closing Monday after the company reached settlements with state attorneys general and the Writers Guild of America (WGA).
“Having now addressed the State AGs’ and WGA’s concerns, we have complete clearance for this merger and look forward to putting these commitments into action,” Paramount Chairman and CEO David Ellison said in a statement.
The deal, valued at roughly $111 billion including debt, would place the two legacy studios, CBS, CNN, Paramount+ and HBO Max under one corporate roof. The state antitrust case had been scheduled for trial on March 2, 2027, while Paramount faced a roughly $7 million daily “ticking fee” beginning Oct. 1 if the transaction remained open, according to Variety.
The proposed settlement still needs a federal judge’s approval. It resolves a lawsuit brought by California and 11 other states, which argued that the merger could reduce competition, shrink the number and variety of movies released and raise prices for moviegoers and cable customers.
“Let me be clear: This settlement is not a vote of support for this merger,” California Attorney General Rob Bonta said.
The agreement does, however, put some muscle behind Paramount’s promises. Under the proposed consent decree, the combined company must release at least 30 movies in each of its first two full years and 32 movies annually in the following three years.
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At least 20 releases in each of the first two years must reach 2,000 screens, with that number rising to 21 in years three through five. The yearly slate must also include four independent movies, while at least half of the required releases must be produced or co-produced by the merged company.
Each qualifying movie must remain exclusively in theaters for at least 45 days and stay off subscription streaming platforms for at least 90 days. At least 20% of the annual slate must carry production and acquisition budgets of $50 million or more, adjusted for inflation, and reach at least 3,000 domestic screens.
The consequences for missing those targets are unusually sharp. If the company fails to fix an annual shortfall within six months, it must divest Miramax and contribute $30 million per missed movie to union benefit funds, the Motion Picture & Television Fund and a fund supporting state antitrust enforcement.
Paramount also committed to spend at least $1.5 billion more on US production over five years than the two companies spent in 2025. The company will put another $47.5 million into workforce training, career development and community arts programs, contribute $25 million to an independent-movie acquisition fund and keep both the Paramount and Warner Bros. studio lots open for five years.
The settlement reaches beyond theater screens. Within 180 days of closing, the company must establish a five-member board of experienced journalists to protect editorial independence at CBS News and CNN, set principles for accuracy and fairness and resolve disputes between newsroom employees and management.
The Writers Guild of America separately settled its lawsuit after the states reached their agreement. Paramount agreed not to lay off writers at CBS News Broadcast for five years and will pay $17.5 million to the union’s health fund, along with its attorneys’ fees.
“Though we were not successful in blocking the merger, our advocacy brought more attention to the harms that this merger — and others like it — will cause,” the guild said.
For families, the promises cut both ways: more movies should receive full theatrical releases, but qualifying titles will not reach subscription streaming for at least 90 days. The bigger test will be whether greater volume produces real creative variety and stories worth families’ time.
The merger is not finished until the court approves the agreement and the transaction closes. This time, though, Hollywood’s big promises arrive with enforceable deadlines and financial consequences — not just a press release.
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