Exclusive Report - Sources Say Paramount Negotiates with States Over CNN Oversight and Film Release Commitments

Added stock price movements in paragraph 5, comments from California in paragraph 7, and Paramount's refusal to comment in paragraph 8.

Jody Godoy

Reuters, September 18 - Paramount (PSKY.O) could reach a settlement as soon as this weekend with the states seeking to block its $110 billion acquisition of Warner Bros. (WBD.O), sources told Reuters on Friday. Current terms under discussion include oversight of CNN’s content by an independent entity.

According to sources, commitments on the number of theatrical releases are also among the settlement terms being discussed.

After the market closed, Paramount shares rose nearly 7%. Warner Bros. Discovery shares climbed 8.4% in after-hours trading.

This lawsuit, brought by California and 11 other states, is the last obstacle on Paramount's road to becoming a major competitor to Netflix (NFLX.O) and Disney (DIS.N). Reaching a settlement this week could help Paramount avoid paying millions of dollars in fees to Warner Bros. shareholders.

A spokesperson for the California Department of Justice stated that potential settlement negotiations are confidential. "We can neither confirm nor deny whether settlement talks are underway, nor can we confirm or deny the content of any alleged negotiations," the spokesperson said.

Paramount declined to comment.

Lawmakers have criticized Paramount CEO David Ellison for allegedly manipulating coverage by CBS News, a Paramount subsidiary, to favor President Donald Trump. Critics are concerned about how he would manage CNN, should he gain control of the media outlet through the Warner deal.

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