Warner Bros shareholders approve Gulf-backed Paramount bid

• Must now pass regulatory checks
• Transaction expected to close in Q3
• Senator issues ‘antitrust’ warning

Warner Bros Discovery (WBD) shareholders “overwhelmingly” approved a proposed $110 billion merger with Paramount that is heavily backed by three Gulf wealth funds.

The transaction, which must now pass regulatory checks, culminates a months-long battle between Paramount and Netflix for the iconic Hollywood studio, which owns titles such as the Harry Potter films, the DC Universe, Friends and Game of Thrones.

WBD also owns streaming giant HBO and global news service CNN.

David Zaslav, WBD’s president and chief executive officer, said in a statement on Thursday that the merger, which is set at a price of $31 per share, will give rise to “a leading, next-generation media and entertainment company”.

The WBD stock closed nearly 1.6 percent down on Thursday, below $27, but is up more than 220 percent from this time last year. 

Saudi Arabia’s Public Investment Fund, Abu Dhabi-based L’imad Holding and Qatar Investment Authority jointly backed Paramount’s hostile takeover with $24 billion in equity. 

They eschewed voting rights to avoid complicating the government approval process as prospective foreign owners.

PIF alone is putting $10 billion towards the deal, the Wall Street Journal reported earlier this month.

This is one of the transactions analysts have recently pointed to as reaffirming Saudi Arabia’s commitment to investing in US assets despite the financial challenges wrought by the American-Israeli conflict against Iran. 

US investment company Redbird Capital Partners is also involved in the Paramount-WBD merger, backing $47 billion in equity along with the family of Larry Ellison, billionaire co-founder of software giant Oracle and father of Paramount’s head David Ellison. 

Redbird has a joint venture with the UAE’s International Media Investments (IMI), a private vehicle that owns newspaper The National and is ultimately controlled by Sheikh Mansour bin Zayed Al Nahyan, Emirati vice president and deputy prime minister, and owner of England’s Manchester City football club. 

Further reading:

• PIF sticks with US funding despite domestic priorities
• Gulf wealth funds in Paramount bid for Warner
• Warner Bros Discovery buys 30% stake in OSN Streaming

Redbird IMI agreed last month to combine its production unit All3Media with that of France’s Banijay Group to create a global media company. 

After rejecting previous versions of Paramount’s hostile bid, the WBD board of directors ultimately recognized an improved offer as the “superior” one in February, recommending shareholders vote for it. 

WBD and Paramount have said they expect the transaction to close in the third quarter of this year. 

During the bidding war for WBD, Paramount often hinted at its owners’ proximity to US President Donald Trump and his administration as bound to ease the regulatory clearance process.

But Democratic Senator Elizabeth Warren wrote in an X post after news of the shareholder vote that the Paramount-Warner Bros merger “isn’t a done deal”.

“State attorneys general across the country are stepping up to stop this antitrust disaster,” she said. “We need to keep up this fight.”