Paramount seeks $1.88 billion bond from 12 state AGs to cover ticking fees and breakup costs tied to the lawsuit delaying its $110 billion merger with Warner Bros. Discovery.
Paramount Global is asking a federal court to force the 12 state attorneys general who sued to block its merger with Warner Bros. Discovery to post a $1.88 billion bond covering the cost of the deal's delay.
The request was filed Monday in the antitrust case brought by a group of states led by California Attorney General Rob Bonta. The states challenged the $110 billion merger in July, arguing it would hurt competition in pay TV and streaming.
The deal combines Paramount's film studio and Paramount+ with Warner Bros. and HBO Max. Paramount has already cleared antitrust reviews from the U.S. Department of Justice and regulators in other countries where approval was needed.
The state lawsuit forced Paramount to push back the expected closing date from September to as late as June 2027. Under the merger agreement, Paramount must pay WBD shareholders an extra 25 cents per share each quarter starting Sept. 30 until the transaction closes. That ticking fee runs roughly $650 million per quarter.
"By the time trial concludes and the parties submit their final briefs, Paramount will have paid Warner Bros. shareholders an unrecoverable $1.3 billion in ticking fees alone," Paramount said in the filing. "Delay also threatens to nullify the regulatory approvals that Defendants have already spent months securing."
The company argued that even winning the case would not recover those costs. "Absent security, even a complete victory on the merits would not restore a dollar of those extraordinary losses," the filing said. "That is precisely why federal law requires plaintiffs to provide security as a condition for receiving preliminary relief such as the court-approved order."
If the deal falls apart because of regulatory obstacles, Paramount would owe WBD a $7 billion breakup fee.
Paramount holds an Alpha Score of 45 out of 100, labeled Mixed, in the Communication Services sector.
The state attorneys general have not yet responded to the bond request. A trial date has not been set.
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