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 so far,” former ESPN President John Skipper mentioned 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 mentioned it “appreciates the views of all its shareholders and takes the outcomes of the annual advisory vote on government compensation critically.”
Zaslav’s outsize compensation grew to become a goal for shareholders earlier this 12 months.Credit: Bloomberg
Just per week later, Zaslav signed a brand new contract that prolonged his employment by way of 2030 and granted him roughly 23 million inventory choices.
Zaslav’s present bundle of choices awarded years earlier had an train worth of no less than $US35 a share, which means they have been nugatory until 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, which means they might be invaluable 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 way of a deliberate spinoff of its cable networks earlier than the tip 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 gained 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 can be value about $US420 million primarily based on Netflix’s $US27.75 per share cash-and-stock provide worth. Besides his fairness awards, wage and money bonuses, Zaslav at the moment owns Warner Bros. inventory value about $US186 million on the providing worth.
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The acquisition can 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, value greater than $US170 million on the acquisition worth.
Netflix’s acquisition of its streaming arm is predicted to shut in 12 to 18 months, with an antitrust assessment anticipated to draw intense scrutiny.
Bloomberg
