Paramount may sell Nickelodeon or Cartoon Network to close $110 billion WBD merger
Subtitle: Bloomberg reported this week that Paramount Skydance is prepared to divest one or both of its major kids TV brands to clear European Union antitrust objections to its $110 billion merger.
Two of the most recognizable kids TV brands in the world are now bargaining chips in a $110 billion media merger.
According to Bloomberg reporting picked up by Investing.com, Yahoo Finance, and Bleeding Cool this week, Paramount Skydance Corp is prepared to divest one or both of its children’s television network assets to secure European Union antitrust approval for its acquisition of Warner Bros. Discovery. The networks in question are Nickelodeon (Paramount) and Cartoon Network (WBD).
The European Commission has until July 7 to either clear the deal, demand structural concessions, or open a full in-depth Phase 2 investigation. Phase 2 would delay closing by months and dramatically increase the risk that the deal collapses entirely.
Paramount CEO David Ellison is racing the clock. The merger agreement includes a ticking fee that starts September 30, 2026 if the deal hasn’t closed. WBD shareholders get $0.25 per share every quarter the deal stays open past that date. The math gets ugly fast.
So Paramount is now publicly signaling it would sacrifice one or both of the most iconic kids TV brands of the past 40 years just to get the merger across the finish line.
Why the EU is the problem
The specific antitrust issue is the overlap between Paramount’s Nickelodeon and Warner Bros. Discovery’s Cartoon Network in the European market.
Per Jennifer Rie, the Bloomberg Intelligence analyst quoted across multiple outlets: “Concerns would be raised if combined market shares exceed 40 percent in any country.”
In several EU member states, the combined Nickelodeon-plus-Cartoon Network share of children’s TV viewing is well above that threshold. About half of all kids channels in Europe are US-owned. The Paramount-WBD merger would consolidate the two largest of those into a single corporate parent.
The EU’s competition rules don’t care about how things have always worked. They care about market concentration. The combined company would control too much of the European kids TV market for the Commission to wave the deal through without remedies.
The remedy on the table: sell one of the networks.
The state lawsuit problem
The EU is not the only regulator threatening the deal.
A coalition of approximately 10 US states, led by California Attorney General Rob Bonta, is drafting a legal complaint to block the merger on antitrust grounds, per Bloomberg’s Friday reporting. The state attorneys general are focused on how the combined company would affect bargaining power with Hollywood content creators and production staff.
This is on top of the federal-level review. The Hart-Scott-Rodino waiting period expired on February 19, 2026, which means there is no longer a statutory federal antitrust impediment to closing. The state lawsuit, if filed, would be a separate legal challenge that could delay closing regardless of federal clearance.
The Saudi money complication
There is also a separate EU regulatory hurdle that has nothing to do with kids TV.
Paramount’s bid is being bankrolled in part by approximately $24 billion in equity finance from three Middle East sovereign wealth funds: Saudi Arabia’s Public Investment Fund, the Qatar Investment Authority, and Abu Dhabi’s L’Imad Holding Co.
That triggers the EU’s recently adopted Foreign Subsidies Regulation, which is designed to prevent firms backed by state sovereign wealth from distorting competition in the 27-nation bloc. The Commission has to determine whether the Middle East funding constitutes a foreign subsidy that disadvantages European competitors.
The EU has not signaled how it will rule on that question. The combination of kids TV market concentration plus foreign subsidy concerns is what makes the July 7 deadline genuinely uncertain.
What Nickelodeon and Cartoon Network are actually worth in 2026
The dirty secret of this whole story is that both brands are a shadow of what they used to be.
Cable TV ratings for kids’ programming have dropped roughly 85 percent over the past 10 years, per industry research. The audience that grew up on Nick and Cartoon Network in the 1990s and 2000s aged out. The audience that should have replaced them moved to YouTube Kids, TikTok, Roblox, and streaming. Nickelodeon and Cartoon Network as linear cable channels are not where kids actually watch animation in 2026.
Both companies have moved primary kids’ content distribution to streaming. Paramount+ carries the Nickelodeon library (SpongeBob, Rugrats, Avatar: The Last Airbender, iCarly). HBO Max carries the Cartoon Network library (Adventure Time, Steven Universe, Regular Show, We Bare Bears). The linear channels exist mostly as legacy distribution and licensing operations.
Which means selling them is structurally easier than it would have been a decade ago. The valuable IP libraries are already separated into the streaming platforms. The linear channels themselves are essentially advertising businesses with declining revenue and aging audiences.
Buyers who could realistically take one or both of them off Paramount’s hands include international media conglomerates looking for European footprint (potentially Banijay or Mediawan), kids-focused IP companies like Hasbro or Mattel that could fold the channel into existing brand operations, private equity firms specializing in declining linear assets, or specialized kids’ broadcasters like Toei Animation or Studio 100.
None of those buyers will pay anything close to what the channels were worth in their 2005 peak. But for Paramount, getting the merger closed at any price is worth more than holding onto a kids’ channel that’s losing money in linear distribution anyway.
What this means for the brands
If Paramount sells Nickelodeon, the linear channel goes to a new owner but the IP library probably stays with Paramount for Paramount+ distribution. SpongeBob, Rugrats, the Teenage Mutant Ninja Turtles franchise, and the rest stay in the Paramount-Skydance-WBD combined entity. The Nickelodeon channel becomes a brand operated under license, similar to how the Disney Channel International operations work in some markets.
If Paramount sells Cartoon Network, the same structure applies. The library (Adventure Time, Steven Universe, Looney Tunes, the Hanna-Barbera catalog) stays with the combined company for HBO Max distribution. The Cartoon Network channel becomes a licensed brand operation.
Either way, the audience-facing brand identity continues, but the corporate parent changes. For viewers, the most visible change might be the loss of new original programming on the linear channel, since the new owners likely wouldn’t have the production budget to commission original animation at the scale Paramount or WBD historically did.
For the animation industry, the consolidation will probably accelerate. Original animation budgets at Cartoon Network and Nickelodeon have already shrunk over the past decade. A divestiture would likely cut them further.
What happens next
The European Commission’s July 7 deadline is the most important date on the calendar. If the Commission approves the merger with remedies (likely requiring the sale of one kids channel), Paramount has roughly six months to identify a buyer and execute the sale before the September 30 ticking fee kicks in.
If the Commission opens a Phase 2 investigation, the deal slides into late 2026 or early 2027. The ticking fee starts accumulating. Pressure on Paramount mounts. The deal could still close, but the economics get progressively worse.
If the state attorneys general file their lawsuit, the deal faces a third front of legal exposure on top of the EU and Foreign Subsidies Regulation reviews. Multi-front antitrust battles have killed mergers before. The Microsoft-Activision deal got through but took years longer than planned. This deal does not have years.
For now, the news is that two of the most recognizable kids TV brands of the past 40 years are now publicly in play. The end of the cable kids TV era was already happening. The Paramount-WBD merger may be the event that formally puts a price tag on it.
The receipts come July 7. The decisions get made over the summer. By Q3 2026, we will know whether Nickelodeon or Cartoon Network just changed hands.
For the audience that grew up on either one, this is the corporate version of watching your childhood get sold off in pieces.
For Paramount, that may be the price of getting the bigger deal done.
Article compiled and edited by Derek Gibbs (entertainment editor) and the Clownfish TV newsroom.
D/REZZED is part of Clownfish TV. For more news, views, and rants on gaming, tech, and pop culture, visit clownfishtv.com. Watch the show on YouTube at @ClownfishTV where new episodes drop daily. Subscribe to the Clownfish TV podcast on Apple Podcasts, Spotify, iHeart, and wherever else you get your podcasts. Sign up for the free newsletter at more.clownfishtv.com.
Hat Tips:
Bloomberg (June 5-6, 2026), primary verified reporting on the Paramount Skydance kids channel divestiture consideration including the Bloomberg Intelligence analyst Jennifer Rie commentary
Investing.com (June 6, 2026), verified Paramount Skydance divestiture reporting and the Bloomberg citation
Yahoo Finance / Bloomberg (June 6, 2026), verified $24 billion Middle East sovereign wealth funding details including Saudi Arabia’s Public Investment Fund, Qatar Investment Authority, and Abu Dhabi L’Imad Holding Co
Bleeding Cool (June 6, 2026), verified coverage of the Bloomberg report including the July 7 EU deadline and the David Ellison ticking fee context
Investing.com / Reuters (June 6, 2026), verified California AG Rob Bonta state attorneys general coalition reporting
SEC EDGAR filings (Paramount Skydance Corp Form 8-K), verified $110 billion enterprise value, $30/share cash offer, ticking fee terms, HSR waiting period expiration February 19, 2026
Adgully (June 2, 2026), verified Paramount Skydance formal EU antitrust filing
Storyboard18 (June 2, 2026), verified European Commission July 7 deadline details
Seeking Alpha (April 29, 2026), historical context on EU antitrust regulator initial signals
Yahoo Finance / Bloomberg, verified EU Foreign Subsidies Regulation context and Jennifer Rie’s “Concerns would be raised if combined market shares exceed 40% in any country” quote
Bleeding Cool, verified “nearly half of the European market for kids’ programming are US-owned” framing
European Commission official merger filing record, verified Paramount Skydance acquisition of Warner Bros. Discovery filing details