“The ink is barely dry on Netflix’s blockbuster $82.7 billion takeover plan of Warner Bros. but there’s a long road ahead, 12 to 18 months to be exact, to get to a real deal close. During that time, the top Warner Bros. Discovery executives will arguably be operating in a holding pattern. They won’t be”, — write: www.hollywoodreporter.com
During that time, the top Warner Bros. Discovery executives will arguably be operating in a holding pattern. They won’t be able to execute a long-term vision, but will mostly keep the lights on and the studio machines running until the former DVD-by-mail company formally takes over and executes its vision for Warner Bros.
To that point, Warners has disclosed a new transaction bonus plan to keep its C-suite intact during what may be a wild ride of regulatory review in the next year or year and a half. That will create a fund in which “designated employees may receive a cash bonus from a pool of $38.7 million” if top execs stick around until Netflix seals the deal to gobble up Warner Bros. studios, HBO and HBO Max, per a Dec. 5 filing with the Securities and Exchange Commission.
The plan will operate “both to recognize and incentivize the contributions of selected key employees, which may include WBD’s executive officers other than its Chief Executive Officer, to the success of the Merger, as well as to secure and encourage the continued employment of such employees through the consummation of the Separation and the Distribution and/or the Merger.”
The cable networks like CNN, TNT Sports, HGTV and the Food Network will be spun off into the Gunnar “Cash Never Lies” Weidenfels-led company named Discovery Global by the third quarter of next year. Those execs will be eligible for the program as well, per the filing: “For employees who will support the SpinCo business following the Separation … individual award amounts, which will not exceed 150% of each recipient’s base salary, will only be payable, subject to such recipient’s continued employment through the consummation of the Merger.”
David Zaslav, who earned $51.9 million in compensation last year, is not taking part in this bonus plan, but his pay was reworked in November to amend his stock option agreement given the sale and upcoming company separation. Zaslav is in line to receive hundreds of millions of dollars if the deal closes thanks to his stock holding and options that haven’t vested yet.
Soon-to-be Discovery chief and current Warners CFO Weidenfels saw a pay package of $17 million last year, chief revenue officer Bruce Campbell received $19.7 million, streaming chief JB Perrette made $19.7 million and international chief Gerhard Zeiler made $14.8 million, per an April filing.
For a window into how a similar process unfolded for the C-suite at another major studio that just sold, take a look at the formerly named Paramount Global. David Ellison’s Skydance Media inked a deal to buy Paramount from controlling stakeholder Shari Redstone in July 2024, but that deal didn’t close until August of this year.
As the deal closed, the “office of the CEO” — co-chiefs Brian Robbins, Chris McCarthy and George Cheeks — were all eligible for termination bonuses. Robbins and McCarthy exited and thus received $21.8 million and $18.6 million in addition to their compensation as bonuses tied to their termination. CFO Naveen Chopra, the chief financial officer who worked on the Skydance deal, jumped to gaming giant Roblox as CFO and, since he left early, the exec forwent a $12 million Paramount award.
As the dust settles on Netflix’s shock-and-awe move to muscle ahead of Ellison and buy Paramount, count on a “Who is staying at Warners and who’s going — or getting pushed out?” narrative to become a guessing game across town over the next few months. After all, even though Netflix co-chief Greg Peters praised the HBO brand in a call with Wall Street analysts on Friday, he didn’t say outright that Netflix will keep HBO Max as a standalone service. And that’s just one part of the Warner Bros. empire.
“We’re highly confident in the regulatory process,” Sarandos added on the call of the next steps toward a close of the acquisition. “This deal is pro-consumer, pro-innovation, pro-worker, it’s pro-creator, it’s pro-growth. And our plans here are to work really closely with all the appropriate governments and regulators, but really confident that we’re going to get all the necessary approvals that we need.”