Warner Bros Discovery (WBD) shareholders have voted “overwhelmingly” in favour of Paramount Skydance’s $110bn takeover deal, but against the $850m-plus exit package for CEO David Zaslav.
The outcome of the preliminary vote announced after Thursday morning’s (April 23) virtual special meeting will come as no surprise to the industry despite vocal opposition, most recently in the form of an open letter signed by close to 4,200 people including Hollywood A-listers.
The sale of WBD to Paramount for $31 a share still needs to clear regulatory scrutiny in the US, UK and Europe, while California attorney general Rob Bonta has said the state is also looking into the proposed merger.
Paramount and WBD executives anticipate the transaction will close by the end of September, after which time a “ticking fee” kicks in and Paramount must pay WBD an additional $0.25 per share each quarter until the merger is consummated. If the deal fails to close by March 2027, each party can walk away.
WBD said on Thursday morning that shareholders voted “overwhelmingly” in favour of the merger. Final results are being certified and will be filed with the US Securities and Exchange Commission (SEC).
“We appreciate the support and confidence our stockholders have placed in us to unlock the full value of our world-class entertainment portfolio,” WBD board chair Samuel A. Di Piazza, Jr. said. “With Paramount, we look forward to creating an exceptional combined company that will expand consumer choice and benefit the global creative talent community.”
Paramount said in a statement that shareholder approval marked “another important milestone” towards the merger, adding: “We look forward to closing the transaction in the coming months and realising the creation of a next-generation media and entertainment company that better serves both the creative community and consumers.”
The $110bn deal with Paramount replaces a previous proposed agreement for Netflix to acquire Warner Bros after the streamer dropped out of the contest in late February.
WBD shareholders voted against the compensation packages for Zaslav and other WBD executives in connection with the Paramount deal. However, the votes were non-binding, meaning the WBD board can proceed with the payouts as planned. Zaslav is in line to collect more than $550m, in additional to more than $300m in tax reimbursements.
Other executives set to receive nine-figure payouts include CEO and president of global streaming and games J.B. Perrette, chief revenue and strategy officer Bruce Campbell, CFO Gunnar Wiedenfels, and president of international Gerhard Zeiler.
Last week at CinemaCon in Las Vegas, Paramount CEO David Ellison pledged to cinema owners that the combined studios will release 30 theatrical features annually, adding that each film would receive a minimum 45-day exclusive theatrical window and arrive on SVoD 90 days later.
Ellison, whose bid was backed in part by his father, the Oracle co-founder and centibillionaire Larry Ellison, presented to a media holding company in an upfront session in New York on Tuesday. The Ellisons are close to Donald Trump and David Ellison is hosting an invitation-only dinner in honour of the US president in Washington DC on Thursday night.
Critics of the merger argue that the consolidation will result in one less buyer for film and TV creators, fewer choices for audiences, and lead to further job losses in a Hollywood landscape ravaged by widespread redundancies.
The open letter stating “unequivocal opposition” to the deal has received almost 4,200 signatures as of Thursday, April 23. Leading figures from the international industry to have signed the letter include JJ Abrams, Denis Villeneuve, Kristen Stewart and David Fincher.
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