The media company and California state officials are discussing a deal to end litigation that prevents the purchase of Warner Bros. Discovery. Paramount shares climbed as much as 6.3% in after-hours trading on news that the parties are in advanced talks to resolve the antitrust suit. The proposed agreement includes commitments regarding the monitoring of CNN and the release of films, sources say.

The talks follow a period of tension in which the company considered moving operations from Los Angeles to Nashville after earlier settlement attempts for the $111 billion acquisition failed. The merger faces a $7 million daily fee starting Oct. 1 if it remains unclosed and is scheduled for a trial in March. The Federal Communications Commission recently approved foreign ownership in excess of 25%, enabling investments from sovereign wealth funds in Saudi Arabia, the UAE, and Qatar.