Paramount has agreed to pay $16mn to settle President Donald Trump’s $20bn defamation lawsuit against its CBS News division, potentially clearing an obstacle as Shari Redstone seeks to move ahead with the sale of her family’s company to Skydance.

The payment will be made to Trump’s future presidential library, marking the second time since the November election that he has won damages from a major news organisation. In December, Disney-owned ABC paid $15mn to Trump’s presidential library to settle a defamation suit. 

The announcement comes as Paramount prepares to hold its annual shareholders’ meeting on Wednesday, where it was to install three new board members. Paramount and Skydance face a deadline to complete a merger by July 7. The companies have an automatic 90-day extension if needed.