Paramount, Warner Bros. shares rally on report of merger settlement agreement

What happened: Warner Bros. Discovery (WBD) and Paramount Skydance (PSKY) stock rallied 7% and 5%, respectively, on Monday. What's behind the move: Paramount has reportedly reached a settlement with California officials, who had sought to block the company's $111 billion acquisition of Warner Bros. on antitrust grounds. Under the agreement, the combined company would face financial penalties if it fails to release at least 30 films in theaters each year. According to two people familiar with the discussions cited by Bloomberg, Paramount would pay $30 million for each movie short of that target. The report also said Paramount could be forced to sell its 49% stake in Miramax if it does not meet the target. (PSKY ) Go deeper with AlphaSpace 11.23 +1.