(The author is a Reuters Breakingviews columnist. The opinions expressed are her own.)
By Jennifer Saba
NEW YORK, Nov 27 (Reuters Breakingviews) - David Zaslav has to boost the HBO operator’s value by $79 bln to collect stock options worth $200 mln. That’s a stretch even if better parts such as video games and streaming services pick up. His compensation, like the dealmaking that created the company, evokes a bygone era.
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CONTEXT NEWS
Warner Bros Discovery on Nov. 8 warned that it might miss its target range for leverage by the end of 2024 without a meaningful recovery in the TV advertising market.
The media company which owns HBO, the Food Network and HGTV, said it was still committed to hitting its target for gross debt of 2.5 to 3 times adjusted EBITDA. At the end of September, the company had net leverage – after deducting $2.4 billion cash – of 4.2 times EBITDA.
Shares of Warner Bros Discovery fell 19% on that day.
In 2021, the WBD board of directors awarded Chief Executive David Zaslav compensation worth $247 million. The pay package included stock options worth up to $203 million at strike prices rising from $35.65 to $43.33 over a vesting period that ends Dec. 31, 2027.
WBD shares closed at $10.85 on Nov. 24.
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(Editing by Peter Thal Larsen and Sharon Lam)
((For previous columns by the author, Reuters customers can click on jennifer.saba@thomsonreuters.com; Reuters Messaging: jennifer.saba.thomsonreuters.com@reuters.net))
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