Two of Hollywood’s oldest studios are trying to become one. The European Commission wants to make sure the money behind the deal isn’t giving anyone an unfair edge.

Paramount Skydance Corp’s proposed acquisition of Warner Bros. Discovery, valued at roughly $111 billion, is now under review by the EU’s Foreign Subsidies Regulation. The Commission has until July 14, 2026, to decide whether to approve the transaction or launch a full investigation that could stretch an additional 90 working days.

The sticking point: approximately $24 billion in financing from sovereign wealth funds based in Saudi Arabia, Qatar, and Abu Dhabi.

What the EU is actually investigating

The Foreign Subsidies Regulation gives the European Commission power to scrutinize deals where non-EU government money might distort competition inside the bloc.

This subsidy review is actually separate from a parallel merger review the Commission is also conducting. That merger assessment has its own provisional deadline of July 7, 2026, one week before the subsidy decision is due. So the deal faces two distinct regulatory hurdles in Europe within the span of a single week.

The deal was first announced on February 27, 2026.

Why $24 billion in Gulf money raises eyebrows

The EU’s concern isn’t necessarily that Gulf money is inherently problematic. It’s that state-backed financing can come with terms, whether explicit or implicit, that private-market financing cannot replicate. Below-market interest rates, extended repayment timelines, or implicit guarantees that reduce risk for the borrower. Any of these could constitute a “foreign subsidy” under the regulation.

The $111 billion price tag makes this one of the largest media transactions ever proposed. For context, Disney’s acquisition of 21st Century Fox closed at roughly $71 billion in 2019.

What this means for investors

The dual-track regulatory review creates two separate decisions, two separate deadlines, two separate legal frameworks.

If the Commission decides to open a full investigation under the Foreign Subsidies Regulation, the timeline extends by 90 working days.