WarnerMedia and Discovery announced a merger on Monday that will create one of the largest U.S. media companies.
The new company is the result of AT&T spinning off WarnerMedia, which owns a variety of major media properties including CNN, TBS, TNT, Warner Bros. film and television studio and HBO, into a new company. That company is merging with Discovery, which owns Discovery Channel, Animal Planet, TLC, the Food Network and various other media properties.
AT&T will receive $43 billion worth of stock in the new company, which will be led by Discovery CEO David Zaslav.
It’s a major deal that allows AT&T to undo one of the largest media acquisitions in history: the 2016 purchase of Time Warner for $85 billion. AT&T billed the deal as a chance to combine its telecommunications business, consumer data and media offerings in a way that could compete with major media and tech companies.
The move to spin off Time Warner, later named WarnerMedia, and combine it with Discovery comes as Netflix and Disney have emerged as the dominant players in the direct-to-consumer streaming market.
In its press release, AT&T said that the new company will be better positioned to compete in the increasibly important streaming world.
“The new company will compete globally in the fast-growing direct-to-consumer business — bringing compelling content to DTC subscribers across its portfolio, including HBO Max and the recently launched discovery+,” the company said in the release.
AT&T will own 71 percent of the new company, with Discovery shareholders getting 29 percent, according to an AT&T press release.
Source: | This article originally belongs to Nbcnews.com
