Shareholders of Warner Bros Discovery (WBD) voted overwhelmingly on Thursday to approve the company's $110bn merger with Paramount Skydance, the parent company of CBS News. The vote marks a significant step in the consolidation of two major media entities.
Shareholder Vote and Executive Compensation
While the merger received strong support, shareholders voted against generous proposed compensation packages for WBD executives, including a $550m payout to outgoing chief executive David Zaslav. The boards of both companies had already approved the deal, and shareholders were encouraged to follow suit.
"Today's stockholder approval is another key milestone toward completing this historic transaction that will deliver exceptional value to our stockholders," Zaslav said in a statement. "We will continue to work with Paramount to complete the remaining steps in this process that will create a leading, next-generation media and entertainment company."
A Paramount Skydance spokesperson echoed the sentiment: "Shareholder approval marks another important milestone towards completing our acquisition of Warner Bros Discovery, building on our successful equity and debt syndications and progress across regulatory approvals. We look forward to closing the transaction in the coming months."
Regulatory Hurdles and Potential Lawsuit
The merger still requires approval from the Department of Justice and European regulatory agencies. Additionally, a coalition of state attorneys general may file a lawsuit to block the deal. If approved, WBD shareholders will receive $31 per share, with the deal expected to close between July and September.
Craig Aaron, co-chief executive of advocacy organization Free Press, criticized the vote: "Today, Warner Bros Discovery shareholders voted for their short-term financial gains, not for the public good. While shareholders voted against fat pay packages for departing executives – a symbolic rebuke, since the board doesn't have to listen to them – they've opened the door to wholesale layoffs across the news and entertainment industry, more propaganda in news coverage, higher prices for consumers and fewer choices for audiences."
Opposition and Concerns
During an online discussion hosted by Free Press and the American Economic Liberties Project, former Federal Trade Commission member Alvaro Bedoya predicted legal action: "I think the question is not just whether he'll intervene, but how many of his fellow state attorneys general will join him." He added, "This is not a done deal. This deal can get blocked. I personally think it will get blocked or undone."
Former CNN anchor Jim Acosta expressed concern about the Trump-friendly Ellison family taking over the cable news network, potentially realigning it to appeal to political conservatives. "I think that the danger is very real that a propaganda network will emerge from this merger," he said.
Last week, US Senator Cory Booker held a hearing featuring actor Mark Ruffalo to criticize the merger, which is likely to lead to significant job cuts in media and entertainment. David Ellison, CEO of Paramount Skydance, declined to attend.
