Hollywood stars unite to oppose Paramount-Warner deal

[NEW YORK] More than 1,000 Hollywood actors, directors and screenwriters have penned a letter opposing the US$110 billion takeover of Warner Bros Discovery by Paramount Skydance, citing concerns about job losses and higher costs with fewer choices for consumers.

Joaquin Phoenix, Glenn Close and Adam McKay were among those signing an open letter expressing “unequivocal opposition” to the proposal, which is undergoing regulatory review in the US and Europe and will likely be scrutinised by the UK as well.

“This transaction would further consolidate an already concentrated media landscape, reducing competition at a moment when our industries-and the audiences we serve-can least afford it,” according to the letter.

“The result will be fewer opportunities for creators, fewer jobs across the production ecosystem, higher costs, and less choice for audiences in the United States and around the world.”

After a contentious, months-long battle, Paramount outbid Netflix in February to win the deal, which will create a sprawling media empire. The combined company will control two legacy studios; two streaming services, including Warner Bros’ HBO Max; two news networks in CNN and CBS; and dozens of cable channels.

“We hear and understand the concerns that some in our creative community have raised and respect the commitment to protecting and expanding creativity,” Paramount said.

The transaction will bring together complementary strengths to create “a company that can greenlight more projects, back bold ideas, support talent across multiple stages of their careers, and bring stories to audiences at a truly global scale”.

Paramount CEO David Ellison has committed to releasing 30 feature films in theatres each year and said that he will continue to invest in movies and TV and maintain the HBO streaming platform.

Throughout the process, Hollywood unions raised concerns that a merger would result in job losses in an industry that has already seen significant layoffs in recent years.

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In a letter advising shareholders to reject the bid in mid-December, the Warner Bros board said Paramount is targeting a total cost savings of US$9 billion, including from its earlier merger with Skydance and the proposed acquisition of Warner Bros, which the board then argued would “make Hollywood weaker, not stronger”.

US Senator Elizabeth Warren has also raised concerns about the deal, calling Paramount’s offer a “five-alarm antitrust fire”.

The regulatory hurdles could be costly for Paramount. The company agreed to pay a US$7 billion termination fee if regulators block the deal, as well as a “ticking fee” of 25 US cents a share every quarter after Sep 30 if the transaction does not close. Paramount has already paid a US$2.8 billion breakup fee to Netflix on behalf of Warner Bros. BLOOMBERG