An $81 billion merger between US-based Warner Bros. Discovery and Paramount has been endorsed by shareholders, moving the deal closer to completion and potentially reshaping the entertainment industry landscape. The majority of Warner Bros. Discovery shareholders have voted in favor of selling the business to Paramount at $31 per share, amounting to a total deal value of nearly $111 billion, including debt.
Paramount, owned by Skydance, aims to acquire all of Warner Bros. Discovery, which includes assets such as HBO Max, popular franchises like “Harry Potter,” and CNN. The approval from shareholders increases the likelihood of this merger materializing. David Zaslav, the CEO of Warner Bros. Discovery, described the shareholder approval as a significant step towards finalizing the transaction, while Paramount expressed eagerness to close the deal in the coming months to establish a new media and entertainment powerhouse.
Despite the shareholder approval, the merger still awaits regulatory reviews, including scrutiny from the US Department of Justice. Warner Bros. Discovery anticipates finalizing the deal in the third fiscal quarter. The road to this merger has been tumultuous, with initial resistance from Warner to Paramount’s advances, which led to a competitive bidding process eventually won by Paramount.
While some industry professionals have voiced concerns about the merger leading to job losses and reduced creative choices, the deal has also attracted scrutiny from state attorneys general, including California’s AG Rob Bonta. Democratic Senator Elizabeth Warren and advocacy groups have expressed reservations about the consolidation of media power.
The merger would bring together two major studios and streaming platforms, potentially offering consumers a wider content selection. However, there are apprehensions about cost-cutting measures, layoffs, and potential impacts on content diversity. The deal also raises questions about editorial changes in media outlets under new ownership, with expectations of shifts similar to those seen at CBS News after its acquisition by Paramount.
The involvement of political figures and foreign investment funds in the deal has also sparked concerns about potential influences on the regulatory process. European regulators are also monitoring the merger closely. Following the shareholders’ vote, shares of Paramount and Warner Bros. experienced a decline in value.