Warner Bros. Discovery Shareholders Vote on $110 Billion Paramount Takeover

Warner Bros. Discovery Shareholders Set to Decide on $110 Billion Paramount Deal

Warner Bros. Discovery shareholders will vote Thursday on a landmark $110 billion merger proposal. Paramount has bid $31 per share for the entire company. The deal covers WBD’s cable TV networks, streaming service HBO Max and the Warner Bros. film studio. This vote brings a lengthy and competitive sale process one step closer to completion.

The $31-per-share offer emerged after several rounds of competitive bidding since September. Paramount ultimately prevailed in a bidding war involving Netflix and Comcast. In late February, Paramount raised its offer to $31 per share. That move prompted Netflix to walk away from its own proposed deal for WBD’s studio and streaming assets.

Netflix co-CEO Ted Sarandos suggested afterward that Paramount was an “irrational” bidder. He said Netflix walked away rather than overpay for Warner Bros. studio and HBO Max. Those assets include some of the most prized content libraries in the entertainment industry. The outcome of Thursday’s vote will determine the next steps for the global media landscape.

Deal Terms and Financial Safeguards

Paramount structured the deal with significant financial protections for both sides. The company included a $7 billion breakup fee if regulators do not approve the merger. Paramount also agreed to pay the $2.8 billion breakup fee WBD owed Netflix. That payment covers the termination of the earlier agreement between WBD and Netflix.

The deal also includes a so-called “ticking fee” provision. This clause increases the price per share if the deal does not close by September 30. Both Paramount and WBD have said the transaction should close in the third quarter. That timeline remains subject to regulatory sign-off.

For shareholders, the financial case appears straightforward. A year ago, WBD traded at approximately $8 per share. Paramount’s $31-per-share offer delivers a substantial premium above that level. Shareholders’ decision on Thursday will set the transformation of the combined company in motion.

Proxy Advisors Back the Deal

Top proxy advisory firm Institutional Shareholder Services recommended that shareholders accept the deal. ISS described the offer as “the result of a competitive sales process and public bidding war.” The firm noted that shareholders will receive a significant premium above the unaffected share price. It also highlighted that shareholders face potential downside risk if the deal does not win approval.

ISS further noted that the cash consideration gives shareholders liquidity and certainty of value. “Given these factors, support for the proposed transaction is warranted,” ISS wrote in its report. The company’s board has also urged shareholders to vote yes. Multiple proxy advisory firms align on recommending approval of the transaction.

Controversy Over CEO David Zaslav’s Exit Package

Despite supporting the deal itself, ISS stopped short of endorsing the proposed exit package for WBD CEO David Zaslav. Zaslav’s departure package includes hundreds of millions in severance and stock awards. The total potential payout exceeds $800 million. ISS specifically called out $500 million in proposed stock awards and flagged a recently added excise tax gross-up valued at approximately $335 million.

That excise tax gross-up relates to what experts call the golden parachute excise tax. Congress originally created this tax in the 1980s. Its purpose was to limit what many considered excessive CEO payouts upon a change of control or sale. Critics argue Zaslav’s package contradicts the spirit of that rule entirely.

The scale of the payout has drawn significant attention from media observers and governance experts. ISS published a detailed report flagging specific concerns about the stock awards. The advisory firm declined to recommend shareholder approval of the golden parachute. This represents a notable split in ISS’s overall assessment of the deal.

Hollywood Opposition and Regulatory Scrutiny

Beyond financial concerns, the deal faces fierce resistance from within the entertainment industry. Thousands of actors, directors, writers and other entertainment workers have signed an open letter opposing the merger. They argue that further consolidation will hurt creators and consumers alike. The letter reflects broader anxiety across Hollywood about shrinking competition.

Opponents are also looking to state-level regulators for intervention. Several Democratic state attorneys general have said they are examining the deal’s impact on the media marketplace. Critics warn the merger could reduce jobs, voices and competition across the industry. Paramount executives, however, remain confident they will secure all necessary approvals.

Paramount CEO David Ellison pushed back against these concerns directly. He told advertisers his goal is to build “a leading media and entertainment company.” Ellison added that the combined company would strengthen competition and better serve the creative community. He also said the new entity would deliver more compelling stories to audiences worldwide.

Ellison’s Ambitions and the Road Ahead

David Ellison, the son of Oracle billionaire Larry Ellison, has worked toward this deal for some time. The acquisition would significantly increase Ellison’s influence in the media industry. He also told advertisers that the company will invest in great content and attract exceptional talent. He added that cutting-edge technology will help people do their best work.

The media world will watch Thursday’s outcome closely. A completed deal would create one of the largest entertainment companies on Earth. Paramount and WBD together would control vast content, distribution and streaming resources. The combined entity would own CNN, TNT, Discovery Channel, HBO Max and the Warner Bros. film studio under one roof.

Regulatory bodies at both state and federal levels still hold the power to block or reshape the deal. The $7 billion breakup fee signals how seriously Paramount takes that risk. Thursday’s shareholder vote, however, marks a critical milestone in the process. Investors and industry watchers alike will be monitoring the results closely.