The US telecommunications giant AT&T announced on Monday an agreement to merge its entertainment and media arm, WarnerMedia, with Discovery Inc., which could create a conglomerate with half a dozen pay channels, Warner Bros studio and other businesses if approved by regulators.
The agreement is conceived as a transaction entirely in sharesAT&T and Discovery Inc. explained in a joint statement.
A) Yes AT&T will receive $ 43 billion in a combination of cash, debt securities and the retention of part of WanerMedia’s debt; in addition, its shareholders will obtain 71% of the shares of the new company.
For their part, the shareholders of Discovery they will have 29% of the new company. The boards of directors of AT&T and Discovery have approved this transaction.
Discovery CEO David Zaslav would lead the new firm, whose board would be made up of thirteen members: seven initially appointed by AT&T, including AT&T chairman, and seven for Discovery, including Zaslav.
If approved by regulators, this agreement may lead to the creation of a new competitor in the entertainment field in the US three years after AT & T’s purchase of Time Warner, with which the communications giant took over CNN, HBO, Cartoon Network, TBS, TNT and the Warner Bros. studio.
The new company will bring together one of the Largest entertainment libraries with over 200,000 hours of programming and a hundred brands such as HBO, Warner Bros., Discovery, DC Comics, Cartoon Network, HGTV, Food Network, the Turner Networks, TNT, TBS, Eurosport, Magnolia, TLC and Animal Planet among others, according to the statement.
It is anticipated that transaction closes mid-2022, pending approval from Discovery shareholders and regulatory authorities.