Paramount makes proposal to buy Warner Eric Gaillard/Reuters and Reproduction This Thursday (23), the United States Court extended the deadline for suspending the purchase of Warner Bros. Discovery by Paramount, in a deal valued at US$110 billion (around R$562 billion). The agreement had already been interrupted before and the promise was that it would resume on August 3rd. Now, however, it will be postponed for another 14 days, and will only be discussed on August 17th. The decision was made by American judge Araceli Martínez-Olguín from Oakland, California. The measure responds to a lawsuit filed by a coalition of 12 American states, led by California, which claims that the merger could reduce competition and harm consumers. ??Do you have any reporting suggestions? Send to g1 The states argue that the union of the two companies would create a media group with enough power to raise the prices of films and TV programs, in addition to weakening competition in the sector. According to the lawsuit, if the purchase is completed before the court's final decision, Paramount will be able to initiate layoffs and share strategic information with Warner Bros. Discovery. If the merger is later found to be illegal, these changes may be difficult to reverse.
US court extends suspension of purchase of Warner Bros. by Paramount for another 14 days
Paramount makes proposal to buy Warner Eric Gaillard/Reuters and Reproduction This Thursday (23), the United States Court extended the deadline for suspending the purchase of Warner Bros. Discovery by Paramount, in a...
The court case could delay Paramount's plans to expand its presence in the entertainment market and compete more directly with streaming giants such as Netflix and Disney. Paramount, in turn, claims that the states' action misinterprets US antitrust laws. The company also claims that a delay in completing the deal would harm entertainment sector workers, who have already been struggling for several years. "We are confident that the evidence will demonstrate that the state attorneys general's antitrust arguments are baseless, as the markets they claim exist and their claims of anticompetitive effects are not supported by the reality of current markets," a Paramount spokesperson told Reuters. Merger faces regulatory hurdles Since the acquisition of Warner Bros. was announced in February. Discovery by Paramount faces a series of regulatory and legal hurdles. Although the US Department of Justice approved the operation, authorities in other countries began to analyze the possible impacts of the merger on competition. The European Commission postponed its decision to evaluate the concessions proposed by Paramount, while the United Kingdom said it may intervene in the operation due to concerns related to competition, streaming and the media sector. In the US, attorneys general from states such as California, New York and Oregon began an offensive to try to stop the merger. They claim that the union of companies could reduce competition in the cinema and pay TV markets, concentrate power in the sector and result in job losses. In addition to resistance from authorities, the agreement also faces criticism from actors, screenwriters, cinema owners and other professionals in the entertainment industry, who fear job cuts and a reduction in the number of films produced and distributed. This Monday's decision (20), which temporarily suspends the completion of the purchase, represents the most recent setback for the billion-dollar operation. Understand the merger The purchase of Warner Bros. Discovery by Paramount is considered one of the largest transactions in the history of the entertainment industry. If completed, the operation will create a group with around 200 million streaming subscribers and a catalog that brings together brands such as HBO, CNN, DC Comics, Harry Potter, Game of Thrones, CBS, Paramount Pictures and Nickelodeon. The impact of the business goes beyond the billion-dollar value. While Warner brings together some of the most valuable brands in the sector, Paramount seeks to gain scale to compete with giants like Netflix and Disney in a market increasingly concentrated on streaming. Unlike the proposal presented by Netflix during the dispute over Warner, Paramount's offer includes the entire Warner Bros group. Discovery, including CNN, HBO and other pay TV networks. If the operation is approved, the Ellison family — which controls Paramount — will also control some of the main brands in American journalism, such as CBS News, the program 60 Minutes and CNN. See the numbers from the merger between Warner and Paramount Arte/g1
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