US Justice Department clears Paramount-Skydance Warner Bros. Discovery merger

The U.S. Department of Justice has signed off on Paramount Skydance's proposed acquisition of Warner Bros. Discovery , clearing the merger of federal antitrust concerns.

"The Division has completed its analysis of the proposed merger of Paramount and Warner Bros. and determined based on the evidence received in its investigation that the transaction is not likely to result in harm to competition or American consumers," the department said in its determination.

A Paramount spokesperson said in a statement the company was "grateful for the Department of Justice's thorough review of this transaction, as well as the work of the other agencies that have completed their reviews and provided clearance to date.

"This deal is pro-competitive, resulting in a stronger company better positioned to compete against dominant technology platforms in an industry increasingly defined by intense competition for audiences, talent, technology, and investment," the spokesperson said. "We remain focused on completing the transaction as soon as possible and delivering its benefits to consumers, creators and the entertainment industry as a whole."

It's an important milestone for the roughly $110 billion deal, though it could still face legal challenges from state attorneys general. California Attorney General Rob Bonta has been among the officials reviewing the proposal, and the deal "remains under investigation by the California Department of Justice," his office said in a statement Friday.

Paramount's stock was up about 3% in after-hours trading. Politico first reported the government approval.

Paramount CEO David Ellison told investors during the company's April earnings call that the deal was on track to close by September, after which point a so-called ticking fee kicks in, making the deal more expensive. The proposed merger has already received WBD shareholder approval.

In late February, Paramount offered $31 per share to acquire all of WBD's assets, which includes cable TV networks like CNN and TBS, the Warner Bros. film studio and streaming platform HBO Max. The proposal came following multiple offers and upended a deal with Netflix for that company to acquire WBD's streaming and film assets.

Paramount is still awaiting regulatory approval from European officials. Earlier this week the European Union's regulator arm began reviewing the proposed deal and set a July 14 deadline for vetting, according to a notice on its website.