Entertainment Tonight and Paramount have just confirmed to CNN that the Nikki Finke Exclusive is indeed true.. she writes:
I’ve just learned that Paramount won’t be picking up Megan Fox’s option on Transformers 3 — and that it was “ultimately” director Michael Bay’s decision. (So he gets his revenge for her remark comparing him to “Hitler”.) Right now Bay et al are finishing up the script for the threequel and “giving Shia a new love interest makes more sense for the story,” an insider tells me. Bay will start casting immediately for the new female co-star.