Paramount settlement clears Warner Bros merger

Paramount has reached a settlement with US states that clears the way for its takeover of Warner Bros. Discovery, officials announced Monday.

The deal would combine Paramount with assets including Warner Bros. Pictures, CNN and the HBO Max streaming service. The Trump administration approved the merger in June without requiring changes to the business, before 12 Democratic-led states sued to block it.

California Attorney General Rob Bonta said the settlement includes a commitment that the merged studio will produce 30 movies in each of the first two years of the deal and 32 movies in each of the following three years. He said at least four films must be independent productions and at least 20 percent must be blockbusters, with financial penalties if Paramount misses the targets.

A joint court filing said the deal also requires at least $300 million more in annual US film production spending by Paramount and Warner Bros. than in 2025. It requires the companies to keep both studios' production lots, honour labour agreements and commit funds to workforce training.

The settlement also creates a News Editorial Independence Board to set editorial principles for the combined company's news channels, including CNN. Compliance would be overseen by an internal monitor, an independent trustee and a committee of five states, with the court retaining jurisdiction over enforcement.

The states had argued that the combined company would control about 27 percent of wide-release theatrical film distribution and a similar share of the basic cable channel industry. Movie industry opponents warned the deal could cut jobs and reduce film production, while news media groups feared CNN's independence could be weakened.