Paramount Skydance Settlement Clears Path for Warner Bros. Deal Close, Morgan Stanley Says

11:13 AM EDT, 09/22/2026 (MT Newswires) -- Paramount Skydance's (PSKY) settlement with 12 state attorneys general is a "clear win" for its proposed acquisition of Warner Bros. Discovery (WBD), Morgan Stanley said in a Tuesday note. The settlement was reached without any required structural remedies, preserving the transaction's $6 billion synergy opportunity and avoiding the ticking fee of $7 million per day starting Oct. 1. The consent decree, which is still subject to court approval, includes a commitment to release 30 films per year for the first two years and is "less aggressive than it sounds," as each studio can simply keep its current cadence of making around 15 films per year, according to the note. The combination of the two studios has a path to more than 240 million subscribers by 2030 and can potentially rival Walt Disney (DIS) and Amazon (AMZN) for a spot behind Netflix in premium Subscription Video on Demand. The deal is expected to close in about two weeks, compared to their previous expectation of mid-2027, the note added. Morgan Stanley reiterated its overweight rating on Paramount Skydance and raised its price target to $11.50 from $10, while lifting its price target on Warner Bros. Discovery to $31 from $29. Morgan Stanley reiterated the stock ratings of the two companies at outperform and raised the price target of Paramount to $11.50 from $10, as well as lifted the price target of Warner to $31 from $29. Price: 10.31, Change: +0.40, Percent Change: +3.99