Paramount CEO David Ellison sent a memo to all staffers looking for to reassure them that the $111 billion acquisition of Warner Bros. will still occur.
The memo comes after Paramount said on Friday that it could put the deal on hold for several months because it fights back against the antitrust lawsuits filed by 12 state attorneys general. Paramount said it could not close the deal until June 2027 or five days after the court issues a ruling on the antitrust case, whichever comes first.
Still, within the memo to staff Monday, Ellison said, “Let me be clear: we remain highly confident that this transaction doesn’t pose any legal issues, and we’ll complete it and produce these two corporations together.” He added that the corporate is within the midst of discussing potential trial dates with the states and would offer an update next Friday.
“I do know this extra uncertainty has been difficult, and I need to thanks in your continued patience, commitment and collective contributions. For now, it stays business as usual. Paramount and WBD are separate corporations operating independently, and our focus stays on serving our audiences, supporting each other and executing our strategy,” he said within the memo, ending with a “Let’s go!”
Full memo:
Team,
I do know there’s been numerous news coverage about our company in recent weeks, and I recognize that references to court proceedings, delays and deal timing can create questions and uncertainty. And so, I need to take a moment to share an update on the litigation related to our proposed transaction with Warner Bros. Discovery.
While a lot of you might have likely been following the deal’s developments, here’s a transient recap. Over the past several months, our leadership team and legal partners have worked closely with antitrust and competition authorities around the globe. In consequence, regulatory bodies and governments representing 65 jurisdictions – including the European Commission, Australia, China, the U.S., Germany, France, Spain, Canada and South Korea – have either cleared the transaction or elected to not challenge it on competition and/or foreign direct investment grounds.
These clearances reflect each the facts and the law: this mixture is fully consistent with the anti-trust laws, and can create a stronger, more competitive media company with the dimensions to take a position more deeply in storytelling, expand consumer alternative and compete more effectively in a rapidly changing entertainment landscape. Just as vital, it would create more opportunities for creators by enabling the combined company to take a position more in content, take creative risks and speed up the technologies that may deliver greater alternative and a greater experience for audiences all over the place.
Absent the lawsuit filed by the California Attorney General together with 11 other attorneys general, and a separate lawsuit from the Writers Guild of America (WGA), each looking for to dam the merger, we might have been in a position to close the transaction in the approaching weeks.
Let me be clear: we remain highly confident that this transaction doesn’t pose any legal issues, and we’ll complete it and produce these two corporations together. To that end, Paramount, WBD, the state attorneys general and the WGA have agreed to not proceed with the court-ordered preliminary injunction hearing scheduled for August 3. The parties will as an alternative move on to a trial on the merits. We imagine that is the fitting path since the facts and the law are on our side, and a full hearing will display why the plaintiffs’ arguments mustn’t prevail.
This week, the parties will discuss potential trial dates and supply an update to the court next Friday. The timing of the trial can be determined after the court reviews those discussions and issues a schedule.
Within the meantime, absent further developments, the completion of the transaction will remain paused. Our teams will proceed planning under the direction of the Integration Management Office (IMO) and in consultation with our legal advisors. Given the revised timeline, the IMO may adjust the pace and sequencing of its work within the weeks ahead to reflect the revised timeline. Those involved in the combination planning effort will hear directly from Tony Driscoll, who leads the IMO for Paramount. I also encourage you to go to the Integration Hub for the newest updates, FAQs and other resources.
I do know this extra uncertainty has been difficult, and I need to thanks in your continued patience, commitment and collective contributions. For now, it stays business as usual. Paramount and WBD are separate corporations operating independently, and our focus stays on serving our audiences, supporting each other and executing our strategy. We’ve had a robust first yr as the brand new Paramount, and that’s due to you. I’m incredibly pleased with every thing this team has achieved.
As at all times, we’re committed to being as direct and transparent as possible. When there may be meaningful, confirmed information to share, you’ll hear it from us. Until then, please know that we remain confident in our position and firmly imagine this transaction is pro-competitive and can deliver meaningful advantages for consumers, creators and the broader entertainment industry.
Thanks again for all you do for our company, our audiences and each other. I hope you might have an exquisite summer and sit up for what we’ll accomplish together within the months and years ahead.
Let’s go!
David