Search

AT&T announces $43 billion deal to merge WarnerMedia with Discovery - CNBC

In this article

U.S. telecom giant AT&T announced Monday a deal combining its content unit WarnerMedia with Discovery, paving the way for one of Hollywood's biggest studios to compete with rivals like media giants Netflix and Disney.

Under the agreement, AT&T said it would receive an aggregate amount of $43 billion in a combination of cash, debt and WarnerMedia's retention of certain debt. AT&T shareholders would receive stock representing 71% of the new company, while Discovery shareholders would own 29%, it added.

If approved by regulators, the deal effectively reverses AT&T's years-long plan to combine content and distribution in a vertically integrated company.

The deal would create a new business, separate from AT&T, that could be valued at as much as $150 billion, including debt, according to The Financial Times.

Shares of U.S. media company Discovery were 27% higher in premarket trading, while AT&T's stock price was up more than 4%.

"This agreement unites two entertainment leaders with complementary content strengths and positions the new company to be one of the leading global direct-to-consumer streaming platforms," AT&T CEO John Stankey said in a statement.

"AT&T shareholders will retain their stake in our leading communications company that comes with an attractive dividend. Plus, they will get a stake in the new company, a global media leader that can build one of the top streaming platforms in the world."

Leadership and governance

AT&T said Discovery President and CEO David Zaslav would lead the new company. The board would consist of 13 members, seven initially appointed by AT&T including the chair, and Discovery would appoint six members, including Zaslav.

"It is super exciting to combine such historic brands, world class journalism and iconic franchises under one roof and unlock so much value and opportunity," Zaslav said, adding that AT&T and Discovery's assets "are better and more valuable together."

The new firm's singular mission, Zaslav said, is "to focus on telling the most amazing stories and have a ton of fun doing it."

Discovery Communications President and CEO David Zaslav and HBO Chairman and CEO Richard Plepler speak onstage during "Who Owns Your Screen?" at the Vanity Fair New Establishment Summit at Yerba Buena Center for the Arts on October 9, 2014 in San Francisco, California.
Michael Kovac | Getty Images

AT&T owns CNN, HBO and Warner Bros. after it acquired Time Warner, since renamed to WarnerMedia, for $109 billion in 2018. Discovery's channels include Animal Planet and the Discovery Channel.

HBO and HBO Max reportedly have around 64 million subscribers worldwide. Discovery said last month it had reached 15 million paying subscribers.

By contrast, Netflix has around 208 million global subscribers, while Disney+ recently surpassed 100 million less than 1½ years after the streaming service launched.

The announcement came after reports over the weekend that the companies were in advanced talks to complete the merger.

— CNBC's Alex Sherman contributed to this report.

Adblock test (Why?)

Article From & Read More ( AT&T announces $43 billion deal to merge WarnerMedia with Discovery - CNBC )
https://ift.tt/3bx1Ggd
Business

Bagikan Berita Ini

0 Response to "AT&T announces $43 billion deal to merge WarnerMedia with Discovery - CNBC"

Post a Comment


Powered by Blogger.