David Ellison, Chairman and Chief Executive Officer of Paramount Skydance, Inc., heads to the State of the Union Address during a joint session of Congress at the U.S. Capitol on February 24, 2026, in Washington, DC.
Anna Moneymaker | Getty Images
This was announced by a group of US and European lawmakers. paramount skydance CEO David Ellison talks about the company’s acquisition proposal warner bros discovery It said shareholder approval of the deal should not be considered final as it will be subject to careful scrutiny by European regulators.
Three European Parliament members and two Democratic U.S. House members issued the warning in a letter sent Thursday and shared exclusively with CNBC.
“In the European Union, the European Commission and the European Parliament will scrutinize market definitions, market share thresholds, customer substitutability, vertical integration effects and downstream impacts on the internal market under the EU Merger Regulation,” they write.
Lawmakers noted that despite the merger being approved in a preliminary vote by WBD shareholders last month, it remains subject to scrutiny by their respective governments. He warned that mergers could create new barriers to competition.
“We express particular concern about public statements suggesting that this transaction is likely to receive minimal regulatory oversight or expedited approval. Such characterizations seem premature,” U.S. Rep. Sam Licciardo, D-Calif., and Deborah Ross, R-North Carolina, wrote, along with European Parliament members Nathalie Loiseau, Brando Benifay, and Andreas Schwab.
Paramount said in an emailed statement that “Paramount is working constructively and proactively with regulators who are closely reviewing the deal,” adding that the deal “represents increased and increased competition, while also allowing our well-capitalized, creative-first company to invest in more projects and bring stories to audiences around the world. It will expand opportunities for creators and increase choice for consumers.”
The warning comes a little more than a week after Paramount’s earnings report, in which Ellison said in a letter to shareholders that “significant progress” was being made toward closing the deal by the end of the third quarter.
“From a strategic perspective, we couldn’t be more excited about this transaction and we remain on track to close it by September of this year,” Ellison said on the company’s earnings call.
This combination brings together the powerful film studios of Paramount and Warner Bros., as well as two popular streaming services, a rich library of franchise content, and a portfolio of TV networks including CBS, TNT and CNN.
“If this transaction does not fully comply with appropriate approval processes and respect all applicable laws, it could significantly reduce competition across interconnected markets, including film and television production, content licensing, theatrical distribution, and streaming services,” the lawmakers wrote. “This could result in fewer choices for consumers and higher prices.”
Lawmakers also expressed concerns about editorial independence. Shortly after Mr. Ellison’s Skydance acquired Paramount last year, the combined company acquired the online publication The Free Press and named its co-founder Bari Weiss editor-in-chief of CBS News.
The long-awaited federal approval of the Paramount-Skydance merger comes on the heels of Paramount paying President Donald Trump a $16 million settlement over his “60 Minutes” interview with then-Vice President Kamala Harris. As part of the lawsuit, Paramount agreed to hire an ombudsman for CBS News.
“We warn of the impact this merger will have on media pluralism and call for internal safeguards to ensure that editorial decision-making remains independent of the interests of corporate shareholders, particularly third-country investors,” the lawmakers wrote to Ellison.
Paramount agreed to acquire WBD for $31 per share and offered a breakup fee of $7 billion if the proposed merger did not receive regulatory approval.
Funding for the deal included about $24 billion from Gulf state sovereign wealth funds, in addition to a line of credit and backing from Ellison’s father, billionaire Oracle co-founder Larry Ellison.
Paramount had previously agreed to a group of Gulf state states waiving voting rights in the new company, and people familiar with the matter said the deal would not result in a mandatory review by the Committee on Foreign Investment in the United States.
The Ellisons are blocking the deal and are prepared to intervene if there is a problem with the foreign investment that affects the overall approval of the deal, the people said.
In late April, Paramount filed a petition with the Federal Communications Commission seeking indirect foreign funding because it owns the U.S. broadcaster CBS.
Still, the investment is met with caution.
“Such a funding structure raises serious questions regarding national security, editorial independence, foreign influence, and potential review by the Committee on Foreign Investment in the United States (CFIUS), especially given the concentration of sensitive user data and critical media assets under a single corporate owner,” the lawmakers said in a letter to Ellison. “In the European Union, the presence of foreign sovereign wealth funds may also raise questions regarding the application of foreign subsidy regulations.”
The companies vowed that the merger would go through a rigorous review process, despite recent comments from some regulators, including Federal Communications Commission Chairman Brendan Carr, who said he expected the merger to be approved “fairly soon.” Notably, the FCC will not approve the deal alone.
“Public trust requires a rigorous and transparent review process. Please consider this letter’s formal notice that any suggestion that this transaction has effectively cleared regulatory hurdles is false,” the lawmakers wrote.
