The European Commission on Wednesday approved Paramount Skydance’s proposed $110 billion acquisition of Warner Bros. Discovery after the company agreed to remedies aimed at addressing competition concerns in the European film distribution market.
As part of the commitments, Paramount agreed to withdraw from United International Pictures (UIP), its European film distribution joint venture with Universal Pictures, within 13 months of completing the transaction.
The company also pledged not to enter into any new film distribution partnership with Universal in Europe for the next 10 years.
The Commission said the commitments would ensure that films produced by the combined Paramount-Warner company would not be distributed alongside those of major rivals such as Universal or Disney, addressing concerns over reduced competition.
The approval marks a significant regulatory milestone for the proposed merger, which would combine two of Hollywood’s largest studios, the HBO Max and Paramount+ streaming platforms, and an extensive portfolio of television networks.
Paramount said regulatory authorities in 65 jurisdictions have now either approved the transaction or declined to challenge it on competition or foreign investment grounds.
The company said the merger would create a stronger global entertainment business capable of competing more effectively with major technology companies while supporting increased investment in film and television production.
Paramount shares rose about 2% in afternoon trading following the announcement.
The deal has already received clearance from the US Department of Justice, but it remains subject to a separate legal challenge brought by a coalition of US state attorneys general.
The coalition, led by California Attorney General Rob Bonta, filed a lawsuit last week seeking to block the acquisition, arguing that combining Paramount and Warner Bros., their streaming services and pay television businesses would reduce competition.
A federal judge in California has issued a 14-day temporary restraining order, temporarily pausing the transaction while the case is considered.
Paramount said the European Commission’s decision weakened key arguments made in the US lawsuit and maintained that it remains on track to complete the acquisition by the end of September.