UK culture secretary Lisa Nandy has signaled her intention to involve Britain's media and competition regulators in reviewing Paramount's $110bn (£85bn) acquisition of Warner Bros Discovery (WBD). The proposed merger would create a media conglomerate controlling major assets including Hollywood studios behind franchises like Superman, Batman, and Top Gun; UK broadcaster Channel 5; news channel CNN; TNT Sports, which broadcasts Champions League, Premier League, and Olympics; and streaming services Paramount+ and HBO Max.
In a written ministerial statement on Tuesday, Nandy said she was 'minded' to ask Ofcom to assess the merger's impact on media plurality and to request the Competition and Markets Authority (CMA) to investigate potential competition issues. 'Following engagement with the parties and independent research, my department has today written to the current and proposed owners of Warner Bros Discovery on my behalf to inform them that I am minded to intervene,' Nandy stated.
Focus on UK Public Interest
Nandy emphasized that her decision is centered on the UK public interest and the range of services available to UK audiences, including Channel 5, TNT Sports, Cartoon Network, Nickelodeon, CNN International, Paramount+, and HBO Max. However, she noted that the Enterprise Act 2002 does not currently cover streaming or video-on-demand services, as it was drafted when viewing was primarily via broadcast linear channels. 'I believe this ought to be able to be considered in relation to this and all future media mergers given the role on-demand viewing now plays in the market,' she said. If she decides to intervene, Nandy plans to bring forward secondary legislation to include streaming and on-demand services in the Act.
Timeline and Response
Paramount and WBD have until July 6 to respond. Nandy clarified that she has not yet taken a final decision on intervention. If she proceeds, she will issue a public interest intervention notice, triggering an investigation process of up to 40 days. Paramount expressed confidence that the deal will clear UK scrutiny without significant delay. 'We are confident that our proposed transaction does not pose any media plurality issues in the UK and remain confident in our stated transaction timeline,' a spokesperson said, adding gratitude for continued constructive engagement with government bodies.
Deal Structure and Regulatory Landscape
Paramount is led by David Ellison, whose father, Oracle co-founder and Donald Trump ally Larry Ellison, has backed the takeover with a $40bn personal guarantee. Three Middle East sovereign wealth funds have contributed approximately $24bn: Saudi Arabia's Public Investment Fund will own about 15%; L'Imad, backed by Abu Dhabi, will hold just under 13%; and the Qatar Investment Authority will own about 10.6%. However, these investors hold no voting shares, with the Ellison family and US partner RedBird Capital retaining all voting control.
Last week, reports indicated that EU regulators are likely to approve the takeover, provided Paramount accepts certain remedies currently being negotiated with the European Commission. The commission has until July 7 to either approve the deal or launch an in-depth investigation. The US Department of Justice approved the deal earlier this month.
