By David Shepardson
WASHINGTON, May 5 (Reuters) – The sole Democrat on the Federal Communications Commission on Tuesday called for a rigorous review of the foreign ownership interests in a proposed Paramount-Warner Bros. Discovery merger.
Last month, Paramount Skydance asked the FCC to greenlight foreign investments backing its acquisition of Warner Bros Discovery. FCC Commissioner Anna Gomez said there are “serious, unresolved questions about how this foreign investment may jeopardize national security, and this commission has a legal obligation to answer them.”
She noted the deal involves sovereign wealth funds from Saudi Arabia, Qatar, and Abu Dhabi investing in a company that would control CBS stations, as well as major cable news operations including CNN.
“The American public deserves to know who owns the airwaves that carry their news. I am alarmed by what appears to be an effort to rubber stamp a financial structure that places nearly half of one of America’s largest broadcast and media companies into the hands of foreign governments with documented records of press suppression and a troubling willingness to silence journalists,” Gomez said.
Paramount did not immediately respond to a request for comment.
The family of Paramount CEO David Ellison will continue to control voting shares, the company said in its filing.
Paramount said last year that Saudi Arabia’s Public Investment Fund (PIF), Abu Dhabi-based L’imad Holding Company, and the Qatar Investment Authority (QIA) had agreed to back its proposed takeover of Warner Bros.
Paramount said the waiver would help expand the reach of its television broadcast operations, and said the new equity investment and anticipated efficiency gains from the transaction “will better position the company to weather continuing challenges facing broadcasters and operators of linear pay-television networks.”
Last July, the FCC approved CBS-parent Paramount’s tie-up with Skydance Media.
Some lawmakers have also urged FCC Chair Brendan Carr to closely scrutinize the foreign ownership plan. Carr has previously suggested this is only a minor issue.
“Paramount’s representations that these investors will hold no governance rights demand careful independent verification,” said Senators Cory Booker, Chuck Schumer, Dick Durbin and others. “Their massive investment creates significant opportunity to obtain data and information about Americans and their viewing habits, and soft power and influence over CNN’s editorial decisions and business priorities.”
(Reporting by David Shepardson; Editing by Stephen Coates)
