With media companies competing internationally in the fast-growing direct-to-consumer business, AT&T’s WarnerMedia merging with Discovery, Inc. is set to create one of the largest streaming players in the world.
“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,” Discovery CEO David Zaslav said in a statement.
Through the deal, AT&T is expected to receive $43 billion in a combination of cash, debt securities, and WarnerMedia’s retention of certain debt, according to a statement.
The Dallas-headquartered organization’s shareholders would receive stock representing 71 percent of the new standalone company, while Discovery shareholders are expected to own 29 percent. Both companies’ Board of Directors have approved the deal.
WarnerMedia and Discovery’s new standalone global entertainment company is said to feature the “most differentiated content portfolio in the world,” per a statement. From HBO to CNN to Animal Planet, the merged organization will play host to a variety of content, amounting to almost 200,000 hours of programming.
Warner Bros., Discovery, DC Comics, Cartoon Network, HGTV, Food Network, the Turner Networks, TNT, TBS, Eurosport, Magnolia, TLC, and ID are also among the combined company’s assets.
“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.
With a global portfolio behind the new company, its projected 2023 revenue is approximately $52 billion, with an adjusted EBITDA of approximately $14 billion, per a statement.
Among the new company’s hopes are to increase its investments in original content, create more opportunities for underrepresented storytellers, and provide its customers with innovative video experiences, according to a statement.
“We will build a new chapter together with the creative and talented WarnerMedia team and these incredible assets built on a nearly 100-year legacy of the most wonderful storytelling in the world,” Zaslav said. “That will be our singular mission: to focus on telling the most amazing stories and have a ton of fun doing it.”
Zaslav is set to lead the new company, with the transaction expected to close in mid-2022.
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