Paramount’s (NASDAQ:PSKY) proposed $110 billion acquisition of Warner Bros Discovery (NASDAQ:WBD) is expected to secure approval from the U.S. Federal Communications Commission, according to a Financial Times report on Monday that cited comments from FCC Chair Brendan Carr.
Speaking to the FT at the Mobile World Congress in Barcelona, Carr said U.S. regulators had previously raised concerns about Warner’s earlier agreement with Netflix (NASDAQ:NFLX), but added that the competitive implications of a merger with Paramount were “drastically different.”
Paramount became the sole remaining suitor for Warner after Netflix opted not to match an enhanced $31-per-share bid for the entertainment group.
Carr told the FT that the majority of the regulatory review will be handled by the Department of Justice, with the FCC’s involvement limited primarily to assessing the transaction’s financial structure.
Paramount’s bid is backed by $47 billion in equity financing, alongside investment from a consortium of Middle Eastern sovereign wealth funds.
“All the information that I’ve seen about that foreign debt . . . is that would qualify under FCC rules as what we call bona fide debt, meaning, it would be a very quick, almost pro forma review,” Carr told the FT.
Despite expectations of regulatory clearance, lawmakers from both political parties have voiced concerns about the deal’s competitive impact, particularly in the streaming sector, where consolidation could narrow consumer choice.
Separately, Netflix co-CEO Greg Peters cautioned in an interview with the Financial Times that the takeover could result in “severe” job losses across Hollywood.
“A bunch of people are going to lose their jobs,” Peters told the FT, just days after Netflix decided against matching Paramount’s improved offer for Warner.
“They’re bidding and winning these deals at prices that I can’t make sense of, that don’t seem economic,” Peters told the FT.
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