UK Clears Paramount's $81 Billion Warner Bros. Discovery Deal

British regulators on Thursday cleared Paramount's $81 billion takeover of Warner Bros. Discovery, removing another obstacle for the merger even as it faces a court challenge in the United States.

The U.K.'s Competition and Markets Authority ruled that combining the two companies would not result in a "substantial lessening of competition" in the country. Britain's Department for Digital, Culture, Media and Sport separately said it would not intervene, citing several "legally-binding commitments" from Paramount concerning its presence in British broadcasting and on-demand entertainment.

Culture Secretary Lisa Nandy had previously said she was "minded to intervene," pointing to competition concerns for news, television and streaming services available to U.K. consumers. Her office said Thursday that Paramount agreed to "provide a set of protections" to safeguard the "continued availability of a diverse range of broadcasting and on-demand services in the UK," along with their editorial independence.

Under the agreement, DCMS said, Channel 5 will keep an "entirely separate" editorial direction from CBS and CNN. Paramount also agreed not to combine its linear channels with on-demand services in the U.K., and to keep children's channels such as Nickelodeon and Cartoon Network distinct from one another. The department said it will monitor compliance and that the company will file annual statements.

Paramount, which was itself bought by Skydance a year ago, called the U.K. clearance "an important milestone." A completed deal would place HBO Max, the "Harry Potter" franchise and CNN under the same ownership as CBS, "Top Gun" and Paramount+. British assets include Paramount-owned Channel 5 in London, localized Nickelodeon programming and Warner's TNT Sports operation in Britain.

Critics have pressed regulators to challenge the deal. In a joint op-ed published in The Guardian on July 27, actors Alan Cumming, Benedict Cumberbatch and Benedict Wong wrote that the merger "threatens to inflict immense harm on the British public."

The companies have agreed to delay closing well into next year while a lawsuit from 12 states, led by California, proceeds. The states allege the combination would "extinguish competition" in Hollywood; the Writers Guild of America has also sued. A 12-day antitrust trial is scheduled to begin in early March, and Paramount has vowed to "vigorously defend" the transaction.

The Justice Department said in June it would not block the deal. Paramount has also secured clearances from the European Union, China, Canada and Australia. Including debt, the purchase is valued at nearly $111 billion.