The U.S. Department of Justice cleared Paramount Skydance’s $110.9 billion all-cash acquisition of Warner Bros. Discovery on Thursday, June 12, 2026, removing the single biggest regulatory hurdle for the largest media merger in a generation. Approval came roughly fifteen weeks after the deal was announced on February 27 and seven weeks after WBD shareholders signed off on the $31-per-share cash offer. With DOJ in the bag, attention shifts to the European Commission’s review due July 7 and the UK Competition and Markets Authority’s deadline of August 7, with a targeted close in September. Public deal disclosures outline the timeline.
Warner Bros. Discovery (NASDAQ: WBD) shares ended the regular session at $26.84, leaving a roughly 15.5% spread to the $31 cash offer, according to Yahoo Finance. That spread is the market’s live read on how much regulatory and execution risk remains. For comparison, deals with little remaining uncertainty typically trade inside a 2–4% spread. The wider gap here reflects a still-pending European review, an unusual ownership wrinkle involving Gulf sovereign wealth funds, and a closing date that is still three months out.
Anatomy of the deal
| Term | Detail |
|---|---|
| Acquirer | Paramount Skydance (NASDAQ: PSKY) |
| Target | Warner Bros. Discovery (NASDAQ: WBD) |
| Deal value | $110.9 billion equity value |
| Offer price | $31.00 per share, all cash |
| Announced | February 27, 2026 |
| Shareholder vote | Approved April 23, 2026 |
| DOJ approval | June 12, 2026 (today) |
| EU decision | Expected July 7, 2026 |
| UK CMA decision | Expected August 7, 2026 |
| Targeted close | September 2026 |
| Reverse termination fee | $2 billion |
| Post-close co-CEOs | David Ellison (PSKY) and David Zaslav (WBD) |
The $31 print is the end of a long negotiation. Paramount’s first three offers—submitted between September and October 2025 at $19, $22, and $23.50 per share—were rejected by the WBD board. The price only crossed the threshold after Netflix entered as a competing bidder. Netflix’s offer valued WBD at roughly $82.7 billion in enterprise value, with a stock-based structure that priced post-split Warner Bros. shares at $27.75, per the deal record. The board accepted Paramount’s revised cash offer at $31 after Netflix granted a waiver allowing the bid to proceed.
Why a 15.5% arb spread today
Three things keep the spread wide. First, the European Commission and UK CMA still have to clear the deal. UK regulators are likely to scrutinize how a combined Paramount+/HBO Max would affect streaming competition in the UK, and the CMA has a history of demanding behavioral remedies. The EU may focus on theatrical-release commitments and CNN’s news distribution.
Second, the deal’s foreign-ownership structure is unusual. Sovereign wealth funds from Saudi Arabia, the UAE, and Qatar are slated to own a combined 38.5% of the post-close entity, structured as non-voting shares with each individual fund’s stake kept below 25% to avoid heightened CFIUS-style scrutiny. While the DOJ’s antitrust review focuses on competition rather than national security, the ownership arrangement is still novel for a U.S.-listed media giant and creates headline risk through close.
Third, the calendar matters. With a September target close, an investor buying WBD today and holding to the $31 settlement would earn a $4.16 gross spread over roughly three months—an annualized return well into double digits. Risk-arb desks are getting paid for the residual uncertainty, not for nothing.
Conditions DOJ attached
Per the public record, the regulatory clearance is paired with several operational conditions that shape the combined company’s post-close roadmap:
- Streaming consolidation: Paramount+ and HBO Max will merge into a single direct-to-consumer service. That removes one of the two biggest competitors to Netflix and Disney+ in the U.S. subscription-streaming market.
- Theatrical commitment: A floor of 30 theatrical releases per year, a concession aimed at preserving the theatrical exhibition ecosystem. AMC Entertainment and Cinemark have been vocal lobbyists for these kinds of release-count commitments since the COVID-era shift to streaming.
- Sports rights: CBS Sports and TNT Sports will be merged post-close, consolidating NFL, college football, and NBA (TNT’s portion) rights into one organization.
- Reverse termination fee: Paramount Skydance is on the hook for $2 billion if the deal fails to clear remaining regulators. The fee, agreed when Paramount upped its bid in December, was a credibility marker that the buyer believed it could clear DOJ and HSR.
Putting the combined company in scale
| Metric | WBD (FY25) | PSKY (FY25) | Combined |
|---|---|---|---|
| Revenue | $37.3B | $28.9B | ~$66B |
| Employees | 35,500 | ~24,000 | ~60,000 |
| Studio brands | Warner Bros, HBO, DC, New Line | Paramount, Nickelodeon | Five major film/TV labels |
| Streaming | HBO Max | Paramount+, Pluto TV | Unified DTC service |
| News | CNN | CBS News | Both |
Even at a simple $66 billion revenue line, the combined company would still trail Disney (around $94 billion FY24 revenue) but would clearly become the second-largest U.S. media conglomerate by revenue. The combined library—Warner Bros, HBO, DC, New Line, Paramount, Nickelodeon, Comedy Central—is arguably the deepest content vault in the industry outside Disney.
What it means for the deal market
The DOJ’s approval matters beyond a single transaction. Mega-cap media M&A has been historically difficult to clear in the U.S.—Disney’s Fox acquisition (2019), Discovery’s takeover of WarnerMedia (2022), and the Microsoft-Activision deal (2023) all faced multi-year reviews with significant remedy demands. A clean DOJ pass on Paramount Skydance/WBD signals that the current administration’s antitrust posture, for content/distribution combinations, is friendlier than the prior cycle. That has knock-on effects for any board weighing a strategic combination—from gaming to streaming to broadcast.
For Netflix, the rejected bidder, the loss is mixed. It does not now have to absorb WBD’s debt or integrate two distinct corporate cultures, but it does have to compete against a single combined Paramount+/HBO Max in the U.S. streaming market—a stronger rival than either platform was standalone. Comcast and Starz, the other two bidders that fell short during the auction phase, walk away with neither a target nor a clear strategic alternative in the prestige-content space.
The next forty-eight days are the calendar to watch. The EU decision on July 7 and the UK CMA’s August 7 deadline are the two remaining gates. If both clear without meaningful remedies, the arb spread should compress sharply toward zero, and Paramount Skydance, David Ellison, and Larry Ellison—who provided equity backing for the financing—will become the senior owners of the second-largest content company in America.
Sources
- Acquisition of Warner Bros. Discovery by Paramount Skydance — public deal disclosures
- Warner Bros. Discovery — company profile
- Paramount Skydance — company profile
- Yahoo Finance — WBD price quote
Disclosure: This article was produced with AI assistance and reviewed before publication. It is for informational purposes only and is not investment advice.