FCC approves Gulf sovereign wealth funds to buy into Paramount

Paramount Global received approval Thursday from the Federal Communications Commission for three Middle Eastern sovereign wealth funds to hold 49.5% of its equity in connection with its proposed acquisition of Warner Bros. Discovery.

The FCC’s Media Bureau granted the declaratory ruling, which allows Saudi Arabia’s Public Investment Fund, Qatar’s Qatar Investment Authority, and Abu Dhabi’s L’imad Holding Company to indirectly hold non-voting Class B shares in Paramount Skydance Corporation. The ruling also grants advance approval for each of the three investors to increase their indirect equity stake to up to 20% at some future point. According to the FCC filing, voting control of the merged entity will rest entirely with the Ellison family and RedBird Capital Partners, with no governance rights extended to any other equity participant.

Because Paramount operates 28 broadcast television stations, federal law requires FCC approval when indirect foreign ownership exceeds 25% in the controlling parent company. Paramount told the FCC that the funding would strengthen its broadcast stations’ journalism capacity and position the company to better withstand intensifying competition across the media landscape.

The commission found that granting the petition would serve the public interest, in part because the foreign investors will hold no voting rights and will have no governance, information, or content influence over Paramount. The ruling quoted the commission’s conclusion directly: “We are persuaded by Paramount’s argument that the Foreign Investors therefore will not be able to wield any influence, let alone control, over decisions involving the Licensees.” The Department of Justice’s national security division also signed a Letter of Agreement setting conditions on the investment, and Team Telecom — a joint federal committee including the Departments of Justice, Defense, and Homeland Security — also approved the financing on Thursday, according to Bloomberg.

The ruling drew criticism. Anna Gomez, the lone Democratic FCC commissioner, said in a social media post that the agency “just let some of the most repressive governments in the world indirectly control nearly all of a combined Paramount-Warner Bros.” She said she had sought to bring the decision to a full commission vote, but it was instead resolved under the Media Bureau’s delegated authority. Media advocacy group Free Press had argued in comments during the proceeding that foreign government ownership of domestic news media was an “extraordinary situation” that could function as a propaganda tool.

As reported when Paramount filed its FCC petition in April, the deal values Warner Bros. Discovery at $110 billion including debt, with $24 billion in equity coming from the three Middle Eastern funds. The merger remains on hold, however. A coalition of 12 state attorneys general led by California, along with the Writers Guild of America, sued in mid-July to block the transaction, and a trial is currently scheduled to begin March 2, 2027.