Paramount Skydance is signaling that a divestiture of CNN remains a possible bargaining chip as it looks for a path through California’s antitrust challenge to its planned $110 billion acquisition of Warner Bros. Discovery.
Makan Delrahim, the company’s chief legal officer, said Tuesday at Politico’s California Agenda conference that Paramount Skydance is keeping “all options” available as it seeks to resolve the lawsuit brought by California officials. Those options, he indicated, include a potential sale of CNN, the cable news network that sits inside Warner Bros. Discovery’s portfolio.
The remarks mark one of the clearest public acknowledgments yet that the company could consider shedding a major Warner Bros. Discovery asset to get the transaction across the finish line. They also suggest Paramount Skydance is preparing for a negotiation that may be as political as it is legal, with regulators, state officials and media rivals all watching closely.
Delrahim, a former head of the Justice Department’s antitrust division, did not announce a divestiture plan or identify a buyer. But by leaving CNN “on the table,” he put a high-profile news brand at the center of the deal’s regulatory drama. CNN has long been one of Warner Bros. Discovery’s most recognizable properties, even as the cable news business faces cord-cutting pressure and a difficult advertising market.
The California suit challenges the proposed combination on competition grounds, arguing that the merger would give the enlarged company too much power across film, television, streaming and related entertainment markets. Paramount Skydance has maintained that the deal is necessary to build a stronger competitor in an industry increasingly dominated by global technology platforms and deep-pocketed streaming giants.
The transaction, if completed, would bring together Paramount’s film and television assets, CBS, Nickelodeon, MTV, Comedy Central and Paramount+, with Warner Bros., HBO, Max, DC Studios, Discovery’s unscripted portfolio and CNN. It would create one of the most consequential media companies in Hollywood, with enormous leverage in content production, theatrical distribution, sports-adjacent programming, streaming bundles and licensing.
That scale is precisely what has drawn scrutiny. While traditional media companies argue they need more heft to survive against Netflix, Amazon, Apple and YouTube, regulators have become increasingly skeptical of consolidation that could reduce buyer competition for talent, raise costs for consumers or narrow the field for independent producers.
Why CNN Has Become a Pressure Point
CNN is a distinctive asset within the Warner Bros. Discovery mix because it is not simply an entertainment property. It carries political, civic and regulatory significance, making any discussion of its sale unusually sensitive. For antitrust officials, a divestiture of CNN could be framed as a structural remedy designed to reduce concentration in news and distribution. For Paramount Skydance, it could be a way to remove a complicated piece of the puzzle without unraveling the broader rationale for the merger.
Still, selling CNN would not be straightforward. The network’s value has been debated across the industry as the cable bundle continues to shrink. CNN remains a global brand with deep newsgathering resources, but it is also in the middle of a long-term transition toward digital subscriptions, streaming products and new audience habits. Any buyer would need not only the capital to acquire the network but also a credible strategy for its next era.
There would also be questions about whether CNN could thrive as a standalone operation or would need to be attached to another media company, technology platform or financial sponsor. A sale could attract interest from strategic buyers seeking news scale, private equity groups looking for a turnaround opportunity, or wealthy investors interested in owning a major news institution. Each option would bring its own regulatory and political complications.
Delrahim’s comments may also be intended to show regulators that Paramount Skydance is willing to be flexible. In major media mergers, companies often float potential concessions before formal remedies are finalized. Such signals can reassure investors that management is not locked into a single path while also testing how regulators and the marketplace react.
The disclosure came alongside another notable acknowledgment: Delrahim became the first Paramount executive to publicly address the possibility that the Los Angeles-based company could leave California. Recent reports, citing unnamed sources, had suggested the company was weighing such a move amid frustration with the state’s legal challenge and the broader business climate.
Delrahim did not present a relocation as a settled decision, but the fact that he addressed it publicly raises the stakes for state officials. Paramount is one of Hollywood’s most storied names, and any departure from California would carry symbolic weight beyond the immediate corporate footprint. It would land at a time when production migration, runaway filming and competition from tax-friendly states have already become major concerns for Los Angeles.
For California, the case is not just about one merger. It is about how aggressively the state wants to police media consolidation while also preserving its status as the center of the entertainment economy. The tension is familiar: elected officials want to protect workers, consumers and competition, but they also face pressure to keep studios, production jobs and corporate headquarters from drifting elsewhere.
For Hollywood, the lawsuit is another reminder that the next phase of consolidation will not move easily. Studios and streamers are looking for combinations that can reduce costs, bundle services and strengthen negotiating power. Regulators, meanwhile, are increasingly willing to challenge deals that might once have been treated as inevitable.
The Paramount-Warner Bros. Discovery combination would reshape the competitive map almost overnight. It could influence everything from theatrical release strategy and franchise management to streaming pricing and talent deals. Writers, directors, actors and producers would be watching closely to see whether fewer buyers mean tougher negotiations, while Wall Street would be assessing whether consolidation can finally stabilize a legacy media sector battered by streaming losses and declining linear TV revenue.
What Happens Next
The California litigation now becomes a central obstacle for Paramount Skydance as it tries to keep the Warner Bros. Discovery deal on track. The company is expected to continue arguing that the merger would strengthen competition against larger technology and streaming rivals, while state officials are likely to press for concessions that address concentration concerns.
A CNN sale is not guaranteed, but Delrahim’s remarks make clear that it is part of the conversation. Whether that becomes a formal remedy will depend on negotiations, buyer interest and whether regulators believe such a move would meaningfully resolve their objections.
The relocation question will also remain under scrutiny. If Paramount Skydance continues to raise the possibility of leaving California, it could add political pressure to an already high-stakes case. For now, the company is keeping its options open — and Hollywood is waiting to see which one it chooses.