Warner Bros. Discovery shares jumped 7% to $29.74 and Paramount Skydance climbed 5% to $10.76 in early Monday trading after the Financial Times reported that Paramount Skydance is closing in on a settlement of the antitrust suit blocking its acquisition of Warner Bros. Discovery since July. Bloomberg reported that under the discussed terms Paramount Skydance would pay $30 million for each film it falls short of a commitment to distribute at least 30 movies in theaters each year, and could be forced to sell its stake in Miramax if it misses that target. The move is a merger-arbitrage repricing rather than a sector event: Netflix rose just 0.45% to $72.12, the Communication Services Select Sector SPDR ETF gained 0.7% to $111.57, and the SPDR S&P 500 ETF Trust added 0.66% to $766.69. No agreement has been signed, and attorneys general in a dozen states plus the Writers Guild have separately challenged the combination, so a deal struck with California alone would narrow the fight without ending it. Warner Bros. Discovery is the side being paid, while Paramount Skydance takes on the film commitment and per-title penalty, which is why the two stocks can rally on the same headline for opposite reasons.
Netflix Inc
Paramount Skydance Corporation
Warner Bros Discovery Inc