AT&T acquired Time Warner assets for $85 billion in deal that close June 2018
Following a flurry of weekend reports of a rumored mega-deal, AT&T and Discovery announced early on May 17 that AT&T would spin off WarnerMedia and combine the company with Discovery. According to terms fo the deal, AT&T will get $43 billion in cash and debt securities, and hold 71% of common equity in the new company. Discovery will receive a 29% stake of common equity and Discovery Communications CEO David Zaslav will lead the new company.
AT&T CEO John Stankey said in a statement that the infusion of cash presents “an opportunity to unlock value and be one of the best capitalized broadband companies, focused on investing in 5G and fiber to meet substantial, long-term demand for connectivity.” He called out “complementary content strengths” that will position the new company “to be one of the leading global direct-to-consumer streaming platforms.”
WarnerMedia’s flagship product is the HBO Max streaming service; the company also controls CNN, TBS, TNT, TruTV, Cartoon Network, the DC catalog of intellectual property, and the Warner Bros. film studio. Discovery’s portfolio includes the eponymous brand as well as HGTV, Food Network, TLC, Animal Planet and other properties.
Zaslav said in a statement: “These assets are better and more valuable together. 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. With a library of cherished IP, dynamite management teams and global expertise in every market in the world, we believe everyone wins.”
The deal is expected to close mid-2022 subject to approval by Discovery shareholders and regulatory approvals.