$110B WARNER BROS. DEAL FROZEN BY STATE ANTITRUST SUIT

🔴 A $110 billion media deal is frozen, and the clock is about to start costing money.

Paramount Skydance's acquisition of Warner Bros. Discovery is stalled after a group of states led by California Attorney General Rob Bonta filed to block it on antitrust grounds. CNBC reports preliminary settlement talks between the California AG and Paramount appeared to fall apart this week.

Paramount agreed to pay $31 per share. If regulatory approval drags past September, Paramount starts owing a "ticking fee," pushing the deal value higher.

What WBD can't do while it waits: major M&A. Its plan to split into two public companies, Warner Bros. and Discovery Global, has ground to a halt. It can still license content, and CNBC reports creators are still pitching the studio.

Bonta told CNBC that settling would require "robust structural remedies," particularly in pay TV and film studios. Per CNBC, bankers are already weighing what goes on the block. New Line Cinema, the nearly 60-year-old studio behind Lord of the Rings and Final Destination, is likely to attract bidders. Turner channels TNT and TBS, and lifestyle networks like HGTV, could also draw interest.

The business itself is not standing still. WBD posted record streaming revenue growth this month, and expects to pass 150 million global streaming subscribers by year end. But the big international expansion is finished, and executives have been told not to expect that pace again.

MoffetNathanson's Robert Fishman wrote on Aug. 5 that both Paramount and WBD run subscale streamers, and that if the deal dies, each is left with a platform unlikely to compete long term.

Should Paramount sell off pieces like New Line to get this deal through?

#WarnerBrosDiscovery #Paramount #HBOMax #Streaming #causeanuproar