Warner Bros. Discovery shareholders approved the merger with Paramount Skydance, but still face antitrust scrutiny from the United States and the European Union.

Warner Bros. Discovery (WBD.US) shareholders approved on Thursday the merger with Paramount Skydance (PSKY.US), despite facing widespread opposition within the Hollywood industry and still undergoing antitrust scrutiny in multiple jurisdictions including the United States and the European Union. Paramount agreed in February of this year to acquire Warner Bros. Discovery for $110 billion, beating out Netflix (NFLX.US) in a months-long bidding war. After the completion of the deal, Warner Bros. Discovery shareholders will receive a cash consideration of $31 per share. The agreement also includes a "contingent compensation clause," where if the deal is not completed by September 30th, shareholders will receive an additional 25 cents per share every quarter until the closing. A Paramount spokesperson stated that the company looks forward to completing the deal in the coming months and building a "next-generation media entertainment company that better serves the creative community and consumers." It is worth noting that shareholders also voted down the compensation package for Warner Bros. Discovery CEO David Zaslav. Prior to this, proxy advisory firm Institutional Shareholder Services had recommended shareholders vote against the package, citing over $500 million in accelerated equity awards and up to $3.35 billion in potential tax compensation, making it one of the largest executive severance arrangements they had seen. However, the compensation vote is non-binding. Despite shareholder approval, resistance from within the industry persists. Over 4,000 Hollywood professionals such as actors, writers, and directors had previously signed an open letter opposing the merger, expressing concerns about layoffs, rising production costs, and reduced choices for film and TV consumers. In addition, Democratic Senator Elizabeth Warren stated after the vote that the deal is far from finalized, and multiple state attorneys general are working to prevent what she called an "antitrust disaster." Paramount CEO David Ellison has tried to reassure the market and creative community, emphasizing plans to produce at least 30 films annually post-merger and committing to exclusive theatrical releases for all films for at least 45 days. If regulatory agencies ultimately block the deal, Paramount would have to pay a $7 billion termination fee. Previously, Paramount had represented Warner in paying Netflix $2.8 billion as a breakup fee when Warner withdrew from a deal with the latter. As of the time of writing, Paramount's stock price had dropped by 5%, while Warner Bros. Discovery's stock price saw a slight decline.