### Hollywood Strategizes for Major Deals as Trump’s Victory Signals Potential Regulatory Rollbacks

In the wake of Donald Trump's presidential triumph on November 7, the atmosphere in Hollywood has shifted dramatically. Warner Bros. Discovery chief David Zaslav and other media executives are signaling a golden era for mergers and acquisitions, spurred by expectations of less stringent regulatory oversight under the new administration. Speaking to Wall Street, Zaslav expressed optimism about the potential benefits the media industry could reap from the upcoming political environment, emphasizing the opportunities for consolidation and accelerated progress.

This optimism is shared by Perry Sook, CEO of TV giant Nexstar, who highlighted the value shareholders could see through further mergers. Similarly, Chris Ripley, chief executive of Sinclair, echoed this sentiment, expressing a belief that regulatory modernization is on the horizon and revealing Sinclair's intent to actively engage in mergers and acquisitions, whether as a buyer, seller, or merger partner.

The anticipation of regulatory relaxation has stirred excitement in corporate boardrooms. Many executives see the next four years as a chance to revive the sweeping consolidations that defined previous decades, such as Disney's acquisitions of Marvel, Pixar, and Lucasfilm. As media conglomerates face the challenges of declining linear TV viewership and the rise of streaming, they are eying a return to a period where transformative deals were commonplace.

At a recent investor conference, Sony Chief Executive Tony Vinciquerra predicted a turbulent period ahead for Hollywood, filled with mergers, bankruptcies, and sales. He suggested that only the largest companies would weather the storm, barring any significant errors.

Trump's approach to regulatory measures is anticipated to facilitate a surge in dealmaking. Alan Klein of Simpson Thacher & Bartlett, who has been involved in notable acquisitions such as Elon Musk's purchase of Twitter and Microsoft's acquisition of Activision, pointed out a conjunction of factors including economic resilience and lowering interest rates as key motivators for corporate mergers.

One of Trump's initial actions in office is expected to be the removal of key antitrust officials Lina Khan and Jonathan Kanter. Their tenure saw an unprecedented level of merger enforcement actions, with 50 cases in fiscal 2022 alone. Trump's approach, likely to roll back some of the stricter antitrust guidelines introduced during the Biden administration, could simplify the regulatory landscape for prospective deals.

The media industry anticipates that deals involving major studios like Disney, Warner Bros. Discovery, and Netflix may proceed with less scrutiny. Big Tech companies are also expected to edge further into Hollywood, with platforms like YouTube potentially looking to acquire content producers to strengthen their offerings.

Trump's stance on Big Tech, though complex, signals a cautious approach. While he has championed antitrust cases against tech giants, he also expressed concern about the potential negative impacts of breaking up companies like Google, suggesting instead that measures should ensure fairness without dismantling the entities.

Amid these developments, media executives are keenly aware of the influence Trump wields. Strong connections and direct access to the President could be pivotal in navigating regulatory challenges. This network-building was exemplified by Zaslav and Elon Musk's recent public appearances together and Warner Bros. Discovery's collaboration with Tesla for a product rollout event.

The narrative extends to the TV broadcast sector, where consolidation efforts are expected to intensify. Sinclair's Ripley expressed confidence that outdated regulations limiting TV station ownership would soon be relaxed. Nexstar, similarly vocal about regulatory reforms, aims to fortify its position against the unfettered reach of Big Tech companies, advocating for modernized rules that level the competitive playing field.

While Trump's presidency may open doors for consolidation, macroeconomic factors like tariffs and interest rates will also play a critical role. Wall Street has cautious expectations, predicting fewer rate cuts from the Federal Reserve, which could temper dealmaking activities.

Not everyone in Hollywood views consolidation favorably. Industry groups, particularly the Writers Guild of America, argue that mergers harm workers by reducing competition and driving down wages. Writer Adam Conover voices a common critique, suggesting that increased dealmaking ultimately disadvantages the industry's labor force.

As Hollywood braces for a possible wave of mergers, the interplay between political shifts and economic conditions will shape the industry's landscape in the coming years.