New Hollywood Giant: US DOJ Approved Merger of Warner Bros. and Paramount Worth 110 Billion

Photo: Mario Tama/Getty Images

The US Department of Justice (DOJ) has officially concluded an eight-month antitrust review and approved the deal, in which, as we previously reported, Paramount defeated Netflix in a fierce battle. As Reuters reports, the department did not demand any asset sales or other restrictions, concluding that the merger would not harm competition.

Regulator's Arguments and Ties to Trump

According to the official statement from the Department of Justice, "the extensive results of the investigation indicate that the effect of the transactions will be to enhance competition across the media and entertainment ecosystem, benefiting American consumers and workers." The regulator dismissed comparisons to the 2019 merger of Disney and Twenty-First Century Fox, noting that since then, Disney has only significantly increased its content spending. Paramount's main argument, which apparently convinced the department, was the thesis that the combined company would be able to compete more effectively with global platforms, as reported by the IXBT.com portal.

The DOJ's decision was largely expected given the political climate: Donald Trump's administration rarely blocked major deals. Moreover, Paramount CEO David Ellison is the son of Oracle co-founder Larry Ellison, who maintains close ties with the president, and the company itself actively hired former government officials.

Hollywood Protests and Threat from States

However, federal approval is not the end of the story. The deal faces strong opposition within the film industry itself. Back in spring, over a thousand people—actors, directors, screenwriters, and producers—issued an open letter against the studio merger, fearing mass layoffs, rising production costs, and a decline in story diversity on screens.

Their stance is shared by the attorneys general of several states, including California and New York, who are preparing a joint lawsuit demanding that the deal be blocked. As Reuters writes, California Attorney General Rob Bonta has already confirmed on social media that his office is continuing an active investigation, and Washington's decision is not the final word for them. Opponents of the merger at the state level intend to prove in court that the creation of such a mega-giant will limit competition for creative talent and narrow choices for audiences.

Arab Money and Financial Pressure

The issue of foreign financing adds another layer of intrigue. Democratic senators have expressed serious concern that sovereign funds from Saudi Arabia, Qatar, and Abu Dhabi, as well as possibly the Chinese corporation Tencent, could acquire stakes in a company that will control national news resources such as CBS and CNN. In response, Paramount representatives stated that the Ellison family will retain control over voting shares, and foreign investors will receive only non-voting shares without the ability to influence editorial policy.

While legal disputes continue, time is working against Paramount. If the merger is not finally completed by October, the company will face a daily penalty of approximately $6.9 million in favor of Warner Bros. shareholders. This story is transforming not just into the largest consolidation of media assets, but into a real test for the American regulatory system, where the federal center has encountered resistance from powerful states.

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