Paramount-Warner Merger: UK Government “Minded To Intervene” In $110B Deal

UK culture secretary Lisa Nandy has said she is “minded to intervene” in Paramount‘s $110 billion takeover of Warner Bros. Discovery (WBD).

In what could be a spanner in the works for the mega-merger, Nandy has said that she wishes to assess whether the deal is in the best interests of UK audiences on plurality grounds.

The minister has written to Paramount and WBD to outline her position. Both companies have until July 6 to make final representations before Nandy makes a formal decision on an intervention.

Paramount said it was “confident” that the deal does not create a “media plurality issue” and that its timeline for completion in the third quarter of this year will not be delayed.

“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,” said Nandy, in a written ministerial statement.

“I am conscious that the proposed acquisition is global in nature. In reaching this decision, my focus has been, and will remain, on the UK public interest and the range of services available to UK audiences, including Channel 5, TNT Sports, Cartoon Network, Nickelodeon, and CNN International, as well as Paramount+ and HBO Max.”

In the statement, Nandy said that investigating public interest issues relating to streaming is not covered under the Enterprise Act 2002, but she may “bring forward secondary legislation” to enable Ofcom to examine how the union of Paramount and WBD would impact on-demand services.

She continued: “If I decide to issue an Intervention Notice, the next stage would be for Ofcom to assess and report to me on the public interest considerations, and for the Competition and Markets Authority (CMA) to assess and report to me on whether a relevant merger situation has been created, and any impact this may have on competition.”

This likely means that the ongoing investigation by the CMA, which opened a merger inquiry earlier this month, will feed into Nandy’s work.

A Paramount spokesperson said: “We are grateful for the continued constructive engagement with all interested government bodies and relevant authorities, including in the UK. 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.”

Paramount’s takeover of WBD is entering a crunch few weeks in Europe, with the European Commission expected to clear the deal rather than subject it to deeper investigation. The Commission has until July 7 to make a decision.