Paramount Launches Proxy Fight for Warner Bros. Fights Pay Package

David Ellison and Paramount will continue to battle for Warner Bros. Discovery.

Paramount on Thursday said that it had filed preliminary proxy materials in anticipation of a proxy fight, and extended its deadline for WBD shareholders to tender their shares to the company for another month to Feb. 20.

Earlier this week, Netflix changed its deal to acquire Warner Bros. to be all-cash valued at $27.75 per share (plus the Discovery Global spinoff “stub”), but despite that change Paramount says that it is sticking with its $30 per share offer for the whole company.

Paramount says that it will ask WBD shareholders to reject the merger deal, to reject the Discovery spinoff (which would happen months before the deal is completed) and to reject the pay packages for senior WBD executives, including CEO David Zaslav.

While the proxy fight won’t see a battle for control of the board, with WBD planning a special meeting specifically for the Netflix merger, it will nonetheless be a high-profile battle for control of one of the entertainment business’ last great studios. And while the battle won’t be waged for as long as Disney’s fight with Nelson Peltz, it could get pricey for both sides, as The Hollywood Reporter previously noted.

Netflix shareholders, meanwhile, don’t seem as keen on the deal, with the streaming giant’s stock hitting a 52-week low after its earnings report this week.

That being said, the filing also suggests that Paramount has a long way to go to persuade WBD shareholders. So far a bit over 168 million WBD shares have been tendered, but the company has nearly 2.5 billion shares outstanding. If shareholder interest continues to wane, Paramount could raise its bid to persuade them to vote no or to tender their shares.