Paramount Skydance agreed to halt its $110 billion bid to acquire Warner Bros Discovery until five days after a court ruling on the merits or June 1, 2027, whichever comes first [1, 2, 3, 4, 5, 6, 7, 8].

The pause results from a lawsuit by 12 US states led by California challenging the merger on antitrust grounds [1, 3, 5, 6, 8]. California Attorney General Rob Bonta said, "We are eager to continue to make our case in court and celebrate another tremendous win in our effort to ensure this unlawful merger never sees the light of day" [3]. New York Attorney General Letitia James called the halt "a critical victory in our efforts to uphold the law and protect the film and television industries" [3].

US District Judge Araceli Martínez-Olguín earlier issued a temporary restraining order blocking the merger, initially pausing the deal through early August. She later extended the pause until August 17 before the longer delay was negotiated [1, 3, 5, 6].

Paramount spokesperson said, "Today’s agreement is a significant win because the result is exactly what we have sought from the outset: a direct path to a trial based on the evidence" [2]. The company argues the merger is pro-competitive and benefits consumers and creators, a view shared by several global competition authorities [1, 3, 5, 6, 7, 8]. Paramount also called the pause "the fastest and clearest way to prove that this transaction is good for competition, good for consumers, and good for creators" [6].

California AG Bonta responded, "Our argument against this illegal merger is straightforward: When too few corporations have too much power in markets central to American life, it makes things more expensive, and it makes things worse" [6].

The Writers Guild of America filed a separate lawsuit opposing the deal and agreed to the pause until the court rules [1, 3, 8].

The delay could cost Paramount about $7 million per day in fees payable to Warner Bros shareholders if the deal is not closed after September 30, potentially totaling between $1.6 billion and $1.7 billion if extended through June 2027 [2, 5, 7, 8]. Paramount must close the deal by June 4, 2027, or walk away but would owe Warner Bros a $7 billion termination fee if the failure is due to regulatory reasons [2, 7, 8].

The merger would combine iconic studios and content, including Warner Bros movies and HBO Max with Paramount’s assets like CBS [2, 4]. The offer includes Warner Bros shares valued at $31 each [7, 8].

The pause extends a legal battle that began on July 13, when the coalition of states filed suit to block the merger [5, 6]. Judge Martínez-Olguín first paused the deal on July 20 with a two-week temporary restraining order [4, 5, 6, 8] and then extended that pause through August 17 on July 23 [1]. Paramount and the states agreed to the current extended pause between July 24 and 26 [2, 3, 4, 5, 6, 7, 8].

The next critical date is June 1, 2027, when the merger must close unless automatically paused further until the trial concludes [2, 3, 4, 5, 8].