David Ellison mulls relocation, while Bonta resists settlement talks, risking delay costs that weigh on both Paramount and Warner Bros.’ shares.
- A Puck report said David Ellison may move Paramount out of California if Attorney General Rob Bonta refuses to negotiate.
- Ellison is considering Georgia, Texas or Tennessee, with a possible five-year job relocation.
- Bonta rejected Ellison’s relocation threat, calling it “blackmail”.
Paramount Skydance (PSKY) and Warner Bros. Discovery (WBD) merger talks are reaching a critical juncture as CEO David Ellison weighs moving Paramount out of California if Attorney General Rob Bonta refuses a negotiated settlement. With a $110 billion deal and mounting daily penalties at stake, Hollywood faces an increasingly consequential showdown over the transaction.
Paramount May Abandon California As Ellison Turns Up Pressure On Bonta
According to a Puck report, Paramount Skydance CEO David Ellison told Paramount’s senior leadership last week that he could begin relocating the company if California Attorney General Rob Bonta refuses to negotiate over the $110 billion transaction.
He has reportedly set October 1 as the decision point, coinciding with the start of a $7 million-a-day contractual fee tied to delays in the deal. Ellison is considering moving Paramount to another state, possibly Georgia, Texas or Tennessee. The company could move its headquarters first, then shift more jobs over the next five years. Paramount would still keep a creative base in Hollywood to remain close to actors, filmmakers, suppliers and other partners.
Paramount Skydance stock remained flat in Wednesday’s premarket. Warner Bros. stock inched 0.2% higher.
Bonta Remains Unmoved
Bonta has dismissed the relocation strategy as an effort to force California into approving a transaction the state considers unlawful. California is part of a 12-state coalition challenging the merger, while regulators in several overseas jurisdictions have already cleared the deal after concessions.
“It is an attempt to blackmail the regulators who are daring to enforce the law fairly and firmly, who are daring to stand up for the rule of law, for a free and fair market instead of a rigged market, for the consumers, workers and the industry by moving to block what is unlawful”, Bonta said during Plotico’s California summit.
He said California remains focused on its antitrust lawsuit challenging the transaction. Bonta added that Ellison’s threat “didn’t work, it won’t work, it will never work.”
Court Sets March 2027 Trial For Paramount-Warner Merger
A federal judge in California has scheduled a 12-day trial starting March 2, 2027. The case involves 12 states and the Writers Guild of America, which argue that the merger could reduce competition in Hollywood.
The groups worry that combining Paramount Skydance and Warner Bros. Discovery could give the new company too much power over movies, TV and creative businesses. Paramount has agreed to keep the $110 billion deal alive until June 1, 2027, or until the court reaches a final decision.
PSKY Stock: Retail View
On Stocktwits, retail sentiment for PSKY remained in‘neutral’ territory.
A user said, “I would not underestimate David Ellisons patience or lack thereof. He has been navigating regulatory hurdles for two full years now on two separate deals. He may just snap and go nuclear.”
Another user said, “looks like someone’s been talking to Bonta! Starting to believe we might get a settlement very soon.”
PSKY stock has cratered 30% year-to-date, while WBD stock has declined 6%.
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