Mumbai: Discovery Inc and AT&T have announced that they have closed their transaction to combine the WarnerMedia business with Discovery. The combined entity is a premier standalone global media and entertainment company Warner Bros Discovery, which will begin trading on the Nasdaq with the start of trading on 11 April, under the new ticker symbol 'WBD.'
The new company combines WarnerMedia’s premium entertainment, sports and news assets with Discovery’s leading non-fiction and international entertainment and sports businesses, including Discovery Channel, discovery+, Warner Bros. Entertainment, CNN, CNN+, DC, Eurosport, HBO, HBO Max, HGTV, Food Network, Investigation Discovery, TLC, TNT, TBS, truTV, Travel Channel, MotorTrend, Animal Planet, Science Channel, New Line Cinema, Cartoon Network, Adult Swim, Turner Classic Movies and others.
“Today’s announcement marks an exciting milestone not just for Warner Bros Discovery but for our shareholders, our distributors, our advertisers, our creative partners and, most importantly, consumers globally,” said Warner Bros Discovery CEO David Zaslav. “With our collective assets and diversified business model, Warner Bros Discovery offers the most differentiated and complete portfolio of content across film, television and streaming. We are confident that we can bring more choice to consumers around the globe while fostering creativity and creating value for shareholders.”
“We are at the dawn of a new age of connectivity, and today marks the beginning of a new era for AT&T,” stated AT&T CEO John Stankey. “With the close of this transaction, we expect to invest at record levels in our growth areas of 5G and fiber, where we have strong momentum, while we work to become America’s best broadband company. At the same time, we’ll sharpen our focus on returns to shareholders. We expect to invest for growth, strengthen our balance sheet and reduce our debt, all while continuing to pay an attractive dividend that puts us among the top dividend-paying stocks in America.”
Under terms of the agreement, which was structured as a Reverse Morris Trust transaction, at close AT&T received $40.4 billion in cash and WarnerMedia’s retention of certain debt. Additionally, shareholders of AT&T received 0.241917 shares of WBD for each share of AT&T common stock they held at the close. As a result, AT&T shareholders received 1.7 billion shares of WBD, representing 71 per cent of WBD shares on a fully diluted basis.
Discovery’s existing shareholders own the remainder of the new company. In addition to their new shares of WBD common stock, AT&T shareholders continue to hold the same number of shares of AT&T common stock they held immediately prior to close.
