Paramount has filed a request for a $1.88 billion bond to be posted by state attorneys general who are challenging the company’s proposed merger with Warner Bros. Discovery. The group of states, led by California’s Rob Bonta, filed their antitrust lawsuit in July against the $110 billion deal, which would combine two major film studios and merge streaming platforms HBO Max and Paramount+. Paramount stated in filings that the states must provide security for potential harm caused by halting the transaction during litigation, citing federal law requirements.
The merger had previously received approval from the U.S. Department of Justice’s Antitrust Division and all relevant global regulatory bodies. However, Paramount agreed in July to delay closing the deal to as late as June 2027 while the states’ case proceeds to trial. Originally, Paramount had planned to complete the acquisition by the end of September. The delay has triggered a “ticking fee” provision in the merger agreement, requiring Paramount to pay WBD shareholders an additional 25 cents per share quarterly starting September 30.
Paramount calculated that by the time the trial concludes and final briefs are submitted, the company will have paid approximately $1.3 billion in ticking fees alone. The company’s filing emphasized that even a complete legal victory would not recover these costs. Paramount also noted additional expenses beyond ticking fees, including lost integration opportunities, reduced content investment, and uncertainty affecting employees of both companies.
Bonta’s office responded that Paramount and Warner Bros. entered the process with full knowledge of regulatory review requirements and willingly included the costly ticking fee provision. The office further stated that Paramount itself agreed to the delay timeline and did not request a bond as a condition at that point. The states suing to block the merger, besides California, include Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon and Washington.
Article Attribution | Read More at Article Source
Article summary produced by Claude AI