By Foo Yun Chee
BRUSSELS, July 22 (Reuters) – Paramount Skydance Corp on Wednesday gained European Union antitrust approval for its $110 billion acquisition of Warner Bros Discovery after agreeing to ditch a film distribution joint venture with Universal Pictures.
The European Commission, which acts as EU competition enforcer, said Paramount Skydance’s offer to end the United International Pictures JV in Europe within 13 months of closing the deal addressed its concerns, confirming a Reuters story.
The company will not do any film distribution deal with Universal in Europe for 10 years and will not transfer the distribution of Warner’s films in theatres to its own distributor, the Commission said.
“These commitments fully address the competition concerns identified by the Commission by ensuring that the films of the merged entity will not be distributed jointly with those of Universal or Disney,” it added.
The transaction faces tougher U.S. challenges.
Last week Paramount Skydance was ordered by a U.S. court to pause the deal, which has been cleared by the U.S. Department of Justice, after a California-led coalition of states argued the merger would irreparably harm competition.
A prolonged interruption will cost Paramount Skydance financially as Paramount CEO David Ellison would be on the hook to pay Warner Bros. shareholders a 25-cent-per-share “ticking fee,” or about $7 million a day for each calendar day the merger is delayed past September 30.
The deal is also the target of a lawsuit by the Writers Guild of America which said it would jeopardize writers’ livelihoods and threaten the health of U.S. entertainment.
Another hurdle is Britain, which last month said it may intervene because of the potential impact on news, children’s television and streaming services.
(Reporting by Foo Yun Chee, editing by Inti Landauro and Alexander Smith)
Comments