AT&T Offloads Media Division, Pronounces Mega-Merger With Discovery, Inc.


The brand new media firm will management Warner Bros. Studio, HBO Max and Discovery+, amongst different properties.

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On the heels of Verizon promoting its stake in Yahoo and AOL earlier this month, one other mega-merger has hit the media world. AT&T has introduced that it’s going to offload its WarnerMedia division to Discovery Communications, Inc. The brand new media firm will management main streaming providers and channels together with HBO and HBO Max, Meals Community, Warner Bros. Studio and Discovery+.

Because of the deal, which is structured as a Reverse Morris Belief in an all-stock transaction, AT&T will obtain $43 billion in money, debt securities and WarnerMedia’s retention of sure debt. AT&T shareholders, in the meantime, can be allotted inventory amounting to 71% of the newly merged entity. The remaining 29% will go to present Discovery shareholders.

“This settlement unites two leisure leaders with complementary content material strengths and positions the brand new firm to be one of many main international direct-to-consumer streaming platforms,” AT&T CEO John Stankey mentioned in a press release. “For AT&T shareholders, this is a chance to unlock worth and be among the finest capitalized broadband firms, targeted on investing in 5G and fiber to fulfill substantial, long-term demand for connectivity.”

The merger is about to shut in mid-2022, contingent on approval by way of vote by Discovery shareholders. Discovery estimates that the brand new firm will herald round $52 billion in income by the top of 2023.

Discovery President and CEO David Zaslav added, “It’s tremendous thrilling to mix such historic manufacturers, world-class journalism and iconic franchises below one roof and unlock a lot worth and alternative…We are going to construct a brand new chapter along with the artistic and gifted WarnerMedia staff and these unbelievable belongings constructed on an almost 100-year legacy of essentially the most great storytelling on the earth.”

Zaslav will proceed to guide the brand new firm, the title of which shall be introduced inside the coming weeks.

AT&T shares have been up 4.42% as of 10 a.m. Monday, with Discovery shares leaping 5.89% in the identical timeframe.



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