A federal judge approved Paramount Skydance’s settlement with 12 states on Wednesday, clearing the final obstacle to its nearly $111 billion takeover of Warner Bros. Discovery. The companies now expect the deal to close Oct. 6. The states had sued to block the merger, and the settlement rests on a promise to release at least 30 films a year. Two penalties back that promise. The combined company must pay $30 million for every film it falls short each year, and it must sell its minority stake in Miramax, the once eminent independent film distributor.
The settlement’s consent decree states, “During each Commitment Year, the Combined Entity shall cause to be released for Theatrical Release in the United States a minimum of thirty (30) Films for the first and second Commitment Years and thirty-two (32) Films for the third, fourth, and fifth Commitment Years.” A later subsection adds, “If, upon the expiration of the Theatrical Cure Period [defined as six months after the end of each year], the Combined Entity has failed to cure the shortfall, the Combined Entity shall divest its entire direct and indirect ownership interest in Miramax Studios.”
