Investing.com — Shares of Paramount Global (NASDAQ:PARA) fell 1.5% following comments from Congressman John Moolenaar, who called for a review of the company’s merger with Skydance Media by the Committee on Foreign Investment in United States (CFIUS). Lawmaker’s concerns arise from China’s involvement Tencent Holdings Ltd (F:)., a recent addition to a US military blacklist, in the agreement.
According to Bloomberg, Moolenaar, who chairs the House China Select Committee, on Wednesday expressed concern about possible Chinese influence in the American entertainment industry through Tencent’s involvement in Skydance. He cited cases of self-censorship within Hollywood to appease the Chinese Communist Party and urged CFIUS to closely examine the merger.
Paramount, which owns CBS, announced its merger deal with film and television producer Skydance Media in July. The scrutiny comes as the US Department of Defense has designated Tencent as a Chinese military company, raising red flags about the technology and entertainment giant’s investments in the US.
The call for a CFIUS review has cast a shadow over Paramount’s stock, signaling investor apprehension about potential regulatory hurdles the merger could face. Paramount and Skydance have not publicly responded to Moolenaar’s statement as of this writing.
The drop in Paramount shares reflects the market’s sensitivity to geopolitical tensions and regulatory challenges, especially when they involve significant foreign investments. The outcome of any CFIUS review could have implications for the future of the merger and Paramount’s strategic direction.
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