Paramount Skydance’s $110 billion takeover of Warner Bros Discovery may face UK hurdle: Report

Britain has signaled it may intervene in Paramount Skydance Corp.’s $110 billion bid to buy Warner Bros. Discovery, opening the door to a lengthy regulatory review even though the deal has already won approval from the United States, China and several other jurisdictions.

If the UK government officially steps in, the merger’s impact on media pluralism and competition could face scrutiny.

Why is Britain reviewing the agreement?

British Culture Secretary Lisa Nandy said the government was considering intervention as the merger could affect the provision of news and on-demand media services in the UK.

“I am aware that the final decision must be reached in a timely manner and I will try to do so appropriately,” Nandy said.

It gave the companies until July 6 to respond before deciding whether to launch a formal public interest investigation.

What concerns does the UK have?

The government’s primary concern is media pluralism; ensuring that no company has undue influence over news and media content.

The combined company will have several significant media assets in the UK, including:

Paramount-owned Channel 5

CNN International, owned by Warner Bros. Discovery

Nandy also noted that Britain’s current media laws were written when broadcast television dominated the market and may not adequately cover modern broadcast services. He said the government could enact new laws if necessary.

The merger has already received regulatory approval for:

Meanwhile, European Union antitrust regulators are still reviewing the transaction.

What does Paramount say?

Paramount has dismissed concerns that the merger threatens media diversity in the UK.

“We are confident that our proposed transaction will not create a media pluralism issue in the UK and we are confident in our stated transaction timeline,” a company spokesman said.

The company continues to expect the deal to close on time.

Once the companies submit their responses, Nandy will decide whether to issue a Public Interest Interference Notice (PIIN).

If it does so, the agreement will be subject to parallel reviews by:

Competition and Markets Authority

Regulators will have up to 40 days to submit their findings.

Based on these recommendations the UK government can:

– Approve subject to remedies such as liquidations or editorial guarantees; or

-Refer to an in-depth Phase 2 study lasting up to 24 weeks.