Warner Bros. Discovery has modified Chief Govt David Zaslav’s contract for a second time this yr to arrange for the corporate’s proposed breakup.
This month’s alterations have been outlined in an SEC submitting on Thursday — per week earlier than preliminary bids are due within the Warner Bros. Discovery public sale. Trade sources count on Paramount, Comcast and Netflix to make provides for the embattled leisure firm that owns HBO, CNN, Meals Community and the storied Warner Bros. film and tv studios.
Warner Bros. Discovery declined to remark.
The sale kicked off in September when David Ellison-led Paramount made an unsolicited supply for Warner Bros. Discovery — a month after Ellison and RedBird Capital Companions had acquired Paramount from the Redstone household in an $8-billion deal. The corporate since has made at the least three bids — however all have been unanimously rejected by the Warner Bros. Discovery board, which considered them as too low.
Paramount’s most up-to-date solicitation for Warner Bros. Discovery was for $23.50 per share, which might worth the corporate at about $58 billion.
The exterior jockeying for Warner Bros. Discovery set the stage for Zaslav and the Warner board to amend his employment settlement. The contract was revised Nov. 7 to make clear that numerous spin-off configurations would end in the identical incentives for Zaslav.
Beforehand, his contract was amended to stipulate his compensation and incentives ought to the Warner Bros. studios and HBO Max spin off from the mum or dad firm, as envisioned when Warner introduced its breakup plans in June. On the time, Zaslav deliberate to remain on to run the studios and streaming firm, which might be known as Warner Bros. in a nod to its historic roots and the pioneering days of the film trade.
The plan was for the corporate’s two dozen cable networks, together with CNN, TNT, Animal Planet and TLC, to stay behind and the corporate renamed Discovery International.
The corporate is forging forward with its breakup plans. Nonetheless, it now plans to spin off the cable channels (Discovery International) and preserve the studios, HBO and the HBO Max streaming service because the surviving company entity (Warner Bros.).
“The modification clarifies that if the separation is achieved by retaining Warner Bros. and spinning off Discovery International (a ‘Reverse Spinoff’) reasonably than spinning off Warner Bros. … the Reverse Spinoff will probably be handled in the identical method … for all functions of the Zaslav preparations,” the submitting stated.
Beforehand, the corporate had envisioned that the cut up can be full by Dec. 31, 2026. However a full-blown public sale might upset these plans — and the transaction might shut at a later date.
Zaslav’s contract was modified to increase his employment by way of December 2030. Beforehand, his contract was set to run out in December 2027.
“This extension is meant to safe Mr. Zaslav’s management of WBD for a similar interval that we had contracted to have him function the chief govt officer of Warner Bros. following a separation,” the submitting stated.
The Wall Avenue Journal was the primary to report that nonbinding preliminary bids for the corporate are due Nov. 20.
