Judge Approves Paramount's Settlement With 12 State AGs, Clearing Warner Bros. Discovery Merger to Close as Mattel's Ynon Kreiz Is Named Co-CEO

A federal judge on Wednesday approved Paramount Skydance's settlement with 12 state attorneys general who had sued to block its acquisition of Warner Bros. Discovery, removing what outlets including Deadline and KIRO7 described as the last legal hurdle to closing the deal. Minutes after the ruling, Paramount announced that Mattel chairman-CEO Ynon Kreiz will join as co-CEO alongside David Ellison starting Oct. 5, according to Variety.

What the judge ruled

U.S. District Judge Araceli Martínez-Olguín wrote that the proposed consent decree "represents a reasonable factual and legal resolution of the dispute" and "falls within the scope of the case made by the pleadings," according to Deadline's report of her order. She also called the settlement a "fair, reasonable, and good faith approach to address the competitive harms" alleged by the states, and found that objectors' hopes for tougher terms "do not rise to the level of legal violations upon which the Court can reject the parties' negotiated resolution," per Deadline and KIRO7.

Notably, the settlement contains no structural remedies such as asset sales. Instead, Deadline reports Paramount accepted legally enforceable commitments running five years after closing, including a set number of theatrical releases, an editorial oversight board for CNN and CBS, and a requirement to negotiate separately with distributors for Paramount and WBD cable networks. Deadline noted "there are some loopholes and there were no structural remedies."

A split reaction from states and critics

California Attorney General Rob Bonta, who led the coalition of 12 states, said the settlement "resolves our antitrust concerns in every market we brought in our case, protects competition and consumer choice, and centers the needs, concerns, and futures of California workers," according to Deadline. Bonta had earlier insisted the agreement "is not a blessing" of the merger. The Block the Merger coalition took a harsher view, calling the outcome a "toothless" deal and warning that allowing the merger to proceed "with no meaningful structural remedies will cost jobs, mute creativity, weaken independent journalism, and damage our First Amendment rights," per Deadline.

The 12 attorneys general had sued in July seeking to block the merger outright, alleging it would "extinguish competition" in cable programming, wide-release movies and blockbuster films, with a trial date set for March before the sides settled, according to Deadline. The Writers Guild of America, which filed a separate suit shortly after the states, also settled with Paramount last week after concluding it could not continue the legal fight alone, Deadline reported.

Deal terms and financing

Reported headline values for the transaction vary by outlet. Deadline cites a "$110 billion acquisition," Variety describes a "$111 billion" merger, and Newsday, citing Associated Press reporting, refers to an "$81 billion mega merger." The outlets have not reconciled those published figures, so each should be read as an outlet-specific characterization rather than a single confirmed valuation.

Deadline reported Paramount will cash out WBD stockholders at $31 a share and that the company began marketing a $44 billion bond offering this week, with proceeds plus equity financing intended to fund the acquisition. Comparing Deadline's own two figures, the $44 billion bond offering and the $110 billion acquisition value it cites differ by $66 billion (110 - 44) — an amount equal to roughly 150% of the bond offering itself, calculated as (110 - 44) / 44 * 100. That arithmetic comparison is our own, based on Deadline's reported numbers, and is offered as interpretation to illustrate the portion of the deal value that equity financing and other capital sources are expected to cover. It is not an independent valuation, a forecast or a statement about the deal's final capital structure.

Deadline also reported Paramount has a financial incentive to close quickly: the company begins accruing a so-called ticking fee to WBD shareholders of about $7 million a day starting Oct. 1 if the deal has not closed by then.

Expected closing timeline

Variety reported the merger is expected to close Oct. 6, citing Paramount regulatory filings. Deadline separately noted that Ellison said last week it would take about two weeks to formally combine the companies, and that Paramount had signaled it aimed to close as soon as early October.

How the co-CEO structure will work

Under the arrangement announced Wednesday, Ellison remains chairman and CEO, focusing on long-term strategy, creative direction, talent relationships, strategic partnerships, technology and capital allocation, according to Variety and Deadline's separate report on Kreiz's hiring. Kreiz, as co-CEO, will oversee day-to-day management and integration of the combined businesses, with the combined company's businesses reporting jointly to both executives, per Variety.

Ellison described the arrangement as "a division of labor built on our complementary strengths, with clear reporting lines," calling Kreiz "a partner with strong leadership and the operating firepower this integration demands," according to Deadline. Deadline also drew a comparison to co-CEO structures at Netflix, Comcast and Spotify, and noted that Kreiz's remit resembles the role Jeff Shell held as president before departing "under a cloud" last April, though Deadline observed that Kreiz arrives with "a full-throated endorsement and more complete delineation of what's expected of him" compared with Shell.

Kreiz's exit from Mattel

Mattel announced earlier Wednesday that Kreiz will step down as chairman and CEO effective Oct. 2 "to take a senior leadership position at another public company," naming Condé Nast CEO Roger Lynch as his successor, according to Variety. Kreiz had led Mattel since 2018 after running Maker Studios, Endemol Group and Fox Kids Europe, and Mattel noted he oversaw Mattel Studios' first theatrical release, "Barbie," the top global box-office film of 2023 and, per Variety, Warner Bros. Pictures' highest-grossing movie of all time.

Other leadership moves

Deadline reported that Cindy Holland, chair of Paramount's direct-to-consumer business, departed with a last day of Tuesday, leaving Casey Bloys, chairman-CEO of HBO and HBO Max Content, positioned as the presumed head of the combined Paramount-WBD streaming business.

RedBird Capital Partners founder and Paramount board member Gerry Cardinale praised Ellison's track record, saying he "has led this company through not one but two historic acquisitions" while "exceeding our synergy targets, beating our financial metrics," according to Deadline and Variety. Bottom line: with the consent decree approved, Variety reported that Paramount's regulatory filings point to an Oct. 6 close, a combination that Newsday described as bringing HBO Max, the "Harry Potter" library and cable networks including CNN under the same roof as CBS, the "Top Gun" franchise and Paramount+.