The U.S. Department of Justice has reportedly approved Paramount Skydance’s proposed acquisition of Warner Bros. Discovery (WBD), removing one of the biggest regulatory hurdles facing a deal that could reshape the global media and entertainment industry.
The approval marks a significant milestone for the roughly $110 billion transaction, which would combine some of the world’s most valuable media assets under a single corporate structure. The deal would unite Paramount’s film, television, and streaming operations with Warner Bros. Discovery’s extensive portfolio that includes HBO Max, CNN, Warner Bros. Studios, TNT Sports, Discovery networks, and a vast library of entertainment content.
A person familiar with the matter told CNBC that the DOJ has signed off on the transaction and is expected to formally announce its decision soon. The development sent Paramount shares about 4% higher in after-hours trading as investors interpreted the approval as a major step toward completion.
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The decision comes after months of scrutiny from regulators and antitrust experts who questioned whether combining two of Hollywood’s largest content producers could reduce competition across film, television, streaming, and advertising markets.
While the DOJ’s approval significantly improves the prospects for the merger, the transaction is not entirely free of regulatory risk. State attorneys general could still challenge the deal, particularly those who have been reviewing its potential impact on competition and consumers. California Attorney General Rob Bonta has previously been reported to be examining the proposal.
The transaction has already secured approval from Warner Bros. Discovery shareholders and recently received clearance from Australia’s competition regulator. European regulators, however, remain an important hurdle. The European Commission has begun reviewing the merger and has set a July 14 deadline for its initial assessment.
The proposed merger is part of the dramatic consolidation sweeping through the global media industry as traditional entertainment companies struggle to compete against technology-driven streaming giants. The combination has been touted to create one of the world’s largest media and content companies at a time when streaming profitability, content costs, and subscriber growth have become central concerns for investors.
The deal also represents a response to mounting pressure from technology platforms that increasingly dominate consumer attention and advertising spending. Companies such as Netflix, YouTube, Amazon, and Apple have intensified competition for audiences, forcing traditional media groups to seek greater scale.
Analysts note that regulators appear increasingly willing to approve large-scale media mergers when the combined companies face powerful competition from technology platforms. Unlike previous eras when media companies primarily competed against one another, today’s entertainment landscape is dominated by digital ecosystems with vast financial resources and global reach.
The DOJ’s apparent approval suggests regulators may have concluded that Paramount and Warner Bros. Discovery need greater scale to remain competitive in a market increasingly shaped by streaming platforms, AI-driven content discovery, and digital advertising giants.
The approval also contrasts with the more aggressive antitrust posture seen in some sectors such as technology and healthcare, indicating that authorities may view media consolidation differently when companies are attempting to counterbalance larger digital competitors.
Combined, Paramount and WBD are expected to control one of the industry’s largest collections of film, television, and news content. As artificial intelligence companies race to secure high-quality training data, ownership of premium intellectual property is becoming increasingly valuable.
Industry analysts believe the merged company could gain greater leverage in licensing negotiations with AI developers seeking access to content libraries for model training, content generation, and media applications. This dynamic has become particularly important as major AI firms such as OpenAI, Anthropic, and Google expand their use of media datasets and negotiate licensing arrangements with publishers and entertainment companies.
Paramount CEO David Ellison previously told investors that the company expects the transaction to close by September. That timeline has become important because a contractual “ticking fee” would make the acquisition more expensive if it extends beyond the targeted completion date.
If European regulators also grant approval and no successful legal challenges emerge from state authorities, the deal could create a media powerhouse with unmatched scale across film production, television networks, sports rights, news operations, and streaming services.
The transaction is expected to rank among the most consequential media mergers of the streaming era, potentially setting off another round of consolidation as competitors seek the size and financial resources needed to compete in the evolving streaming industry.