Warner Bros shareholders back $110bn Paramount merger

Warner Bros Discovery shareholders have backed the company's proposed $110 billion merger with Paramount Skydance, but cast an advisory vote against executive compensation plans tied to the deal.

Under the pay packages proposed to executives, CEO David Zaslav could receive up to $887 million if the sale is completed. Proxy advisor ISS had said Zaslav's potential payout was "extremely large".

"Management now faces a twofold challenge: securing (regulatory) approval for the deal and proving it can create long-term value without fuelling concerns around excessive pay," PP Foresight analyst Paolo Pescatore said.

With shareholder approval secured, attention now turns to regulatory authorities, with both Washington and London expected to examine the merger's impact on competition.

The US Department of Justice sent subpoenas in late March seeking information on how the merger would affect studio output, content rights, streaming competition and movie theaters.

"The real regulatory pressure sits overseas, where European authorities will focus on structural market impact," said Forrester research director Mike Proulx.

Paramount won a months-long bidding war with Netflix for Warner Bros, a victory that cements CEO David Ellison as a powerful force in the rapidly contracting entertainment landscape.

The merger has also drawn opposition from actors, filmmakers and cinema groups, who argue it would eliminate a major studio and reduce creative opportunities.

More than 4,000 film industry professionals and consumers said in an open letter that the deal would lead to fewer jobs and less choice for audiences.

"Shareholder approval marks another important milestone towards completing our acquisition of Warner Bros Discovery," a Paramount spokesperson said.

The deal is expected to close in the third quarter this year.