The UK competition watchdog, the Competition and Markets Authority (CMA), has initiated a formal investigation into the proposed acquisition of Warner Bros. Discovery by Paramount Skydance.
It includes about $29 billion in debt and is among the biggest media shakeups in Hollywood.
If approved, the project would create one of the largest film studios in the world, allowing Paramount to exploit Warner’s vast trove of intellectual property, including franchises such as ‘Harry Potter’ and ‘The Matrix’.
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This will also allow Paramount to strengthen its streaming efforts, with a possible combination of HBO Max and Paramount+, allowing it to gain market share and compete with market leader Netflix, which also tried to buy Warner but refused to match Paramount’s offer.
The CMA has launched an investigation to understand whether a deal between the entertainment giants could harm competitiveness in a sector or region of the UK. The announcement of the body’s preliminary decision is scheduled for August 7th.
Interested parties in the United Kingdom sent their objections and data to the body in April this year, indicating their opinions on the impact of the transaction on regional competition.
UK is not alone in contesting the acquisition
One from Warner Bros. by Paramount Skydance.
While it is unclear which states will take legal action, California Attorney General Rob Bonta told Reuters that his office will make a decision soon on whether to take any action.
The proposed transaction has faced resistance from actors, screenwriters and other Hollywood professionals due to its potential to eliminate jobs.
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Paramount denied that the deal will reduce creative jobs, saying it will need to create more content after the transaction to attract streaming subscribers.
