A majority of shareholders rejected Zaslav’s pay bundle in an advisory vote on the firm’s annual assembly in June. “It’s an incredibly excessive wage for what can’t be seen as a profitable efficiency thus far,” former ESPN President John Skipper stated in reference to the vote on an episode of the podcast Pablo Torre Finds Out.
In a press release on the time, Warner Bros.’ board stated it “appreciates the views of all its shareholders and takes the outcomes of the annual advisory vote on govt compensation significantly.”
Zaslav’s outsize compensation grew to become a goal for shareholders earlier this 12 months.Credit: Bloomberg
Just every week later, Zaslav signed a brand new contract that prolonged his employment by 2030 and granted him roughly 23 million inventory choices.
Zaslav’s current bundle of choices awarded years earlier had an train worth of at the least $US35 a share, that means they had been nugatory except he was capable of greater than triple the corporate’s share worth.
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The new batch of choices got here with a extra attainable hurdle of simply over $US10, that means they could possibly be helpful with solely a modest uptick within the inventory worth. But there was a catch: The majority would solely be redeemable if Zaslav was capable of information Warner Bros. by a deliberate spinoff of its cable networks earlier than the top of 2026.
In early November, the corporate amended the settlement to broaden that definition. It clarified that Zaslav’s choices would stay eligible to vest if the studio entered any change-in-control transaction.
That tweak meant the choices would vest no matter how an eventual deal was structured and whether or not Paramount Skydance, Netflix or one other suitor received the bidding struggle.
Netflix deal
After Warner Bros. fielded a number of sweetened bids this week, Netflix introduced on Friday it had acquired the corporate’s streaming studio belongings. Once the deal closes, Zaslav’s choices tied to his 2025 employment settlement shall be price about $US420 million primarily based on Netflix’s $US27.75 per share cash-and-stock supply worth. Besides his fairness awards, wage and money bonuses, Zaslav at present owns Warner Bros. inventory price about $US186 million on the providing worth.
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The acquisition can also be anticipated to set off change-in-control phrases that may speed up the vesting of practically 6.3 million efficiency restricted inventory items awarded to Zaslav, price greater than $US170 million on the acquisition worth.
Netflix’s acquisition of its streaming arm is anticipated to shut in 12 to 18 months, with an antitrust overview anticipated to draw intense scrutiny.
Bloomberg
