AT&T has agreed to spin off its WarnerMedia group and merge it with its rival programmer Discovery, becoming a member of two of the biggest media companies within the nation, the businesses introduced Monday.
The deal, which may create a brand new large media firm valued at round $150 billion, will mix HBO, Warner Bros. studios, CNN and several other different cable networks with Discovery’s quite a few reality-based cable channels, together with Oprah Winfrey’s OWN, HGTV, The Meals Community and Animal Planet.
AT&T will obtain $43 billion in a mixture of money, debt and WarnerMedia’s retention of sure debt for the deal, the businesses mentioned. Whereas present AT&T shareholders will obtain inventory representing 71 % of the brand new firm, Discovery shareholders will management 29 %, they mentioned.
The transfer comes three years after AT&T acquired WarnerMedia, then often called Warner Bros, for $109 billion.
The becoming a member of of the 2 media corporations may higher place the newly shaped firm to compete with streaming giants like Netflix, Amazon Prime Video and Disney, which owns Hulu, Disney+ and ESPN+.
David Zaslav, the CEO of Discovery, will lead the merged firm, in keeping with the announcement.
“I’ll be in New York, I’ll be in LA, anyplace on the planet the place the creatives are to try to drive one of the best artistic tradition instantly at this time, as a result of that’s what’s going to make us the nice firm — and the nice streaming firm — that John and I began speaking about just a few months in the past,” Zaslav mentioned.
“This settlement unites two leisure leaders with complementary content material strengths and positions the brand new firm to be one of many main world direct-to-consumer streaming platforms,” John Stankey, CEO of AT&T, mentioned in an announcement. “AT&T shareholders will retain their stake in our main communications firm that comes with a horny dividend. Plus, they may get a stake within the new firm, a worldwide media chief that may construct one of many high streaming platforms on the planet.”