Paramount to Exit Universal Distribution Joint Venture to Win EU Approval for Warner Bros. Merger

Paramount Skydance has committed to withdrawing from United International Pictures, its film distribution joint venture with Universal Pictures, as a condition for securing approval from the European Union for its $111 billion acquisition of Warner Bros. Discovery, according to a regulatory filing made public on Wednesday.

The European Commission’s antitrust authorities last week suggested Paramount drop its UIP stake to allay antitrust concerns voiced by European cinema operators over the Paramount-WBD merger. Set in 1981, the London-based UIP was once a major international distributor for both studios. But the operation has been scaled back over the years and now operates in a just handful of European markets, including Denmark, Greece, Croatia, Hungary, Norway, Poland and Sweden.

The Commission has not disclosed further details of the remedies proposed by Paramount to address its concerns with the WBD deal, consistent with its standard practice in merger reviews. The Commission said it has now extended its “new provisional deadline” to reach a decision on approval of the mega-merger from July 7 to July 22. The move suggests EU approval of the deal could be forthcoming.

The mega-merger, announced in February following a competing bid from Netflix for WBD, would combine Paramount’s portfolio — including CBS, CBS News, Paramount Pictures and Paramount+ — with Warner Bros. Discovery’s HBO, HBO Max, Warner Bros. Pictures, CNN, TNT, TBS and HGTV, among other assets. The deal includes a combined $24 billion in investment from Saudi Arabia’s Public Investment Fund, Abu Dhabi’s L’imad Holding Company and the Qatar Investment Authority.

The Department of Justice in the U.S. has already cleared the deal. In the U.K., Culture Secretary Lisa Nandy said Tuesday she is considering intervening in the deal over concerns about media plurality, citing the combination of UK broadcaster Channel 5 and TNT Sports with Paramount+ and HBO Max under common ownership. Britain’s Competition and Markets Authority is conducting a separate review whose findings will inform Nandy’s final decision.

Paramount did not immediately respond to a request for comment.