Will Netflix have to start shaking?
The long-awaited operation has now become a reality. Warner Bros Discovery was born from the merger between WarnerMedia and Discovery, which promises to be one of the next big names in streaming.
We had already talked about it in an article a few weeks ago, but it was still far from official. The HBO Max and Discovery + platforms were expected to merge reasonably soon, by admission of Discovery CFO Gunnar Wiedenfels.
At that time we talked about a 43 billion dollar maneuver, and actually we did not deviate much from the truth. So let’s see the commercial operation in detail.
Nasce Warner Bros Discovery
Then it’s done: Warner Bros Discovery is born. And already the press (at least that of our country) is in disagreement on the naming: some report it with the traditional period after “Bros”, others do not. Although, we confess, on the brand new official website the point has been maintained.
But to immediately move on to much more substantial things, the new entertainment giant will debut at Nasdaq on Monday 11 April with the new symbol WBD.
The actors in the field
The companies of the streaming platforms HBO Max and Discovery + have merged. Let’s explain: HBO Max is a video on demand streaming service operated by WarnerMedia, a subsidiary of AT&T. While Discovery, active since 1985, is a television company that develops thematic channels, in addition to the Discovery + streaming platform.
With Warner Bros Discovery we will be facing a giant that will offer its audience the most complete range of channels.
It will range from Discovery Channel to Discovery +, via CNN and CNN +. And then DC, Eurosport, HBO, HBO Max, HGTV Food Network, Investigation Discovery. And much more.
In short: the entertainment, sports and news of WarnerMedia’s offer will add to Discovery’s international channels.
The two streaming platforms together would have about 100 million users: 74 million HBO Max and 22 Discovery Plus. Netflix, still far out in number, said it had globally reached 221 million users.
But the new full range of Warner Bros Discovery offerings could give the newborn brand a mighty leap forward.
The operation
The merger between WarnerMedia and Discovery has actually been talked about for about a year. But the official announcement only arrived on Friday 8 April.
Following the deal, AT&T received $ 40.4 billion in cash and some debt maintenance from WarnerMedia.. In addition, AT&T shareholders received precisely 0.241917 shares of Warner Bros Discovery for each ordinary share of AT&T. Thus, globally, AT&T shareholders received 1.7 billion shares of the new brand, or 71% of the shares of Warner Bros Discovery.
The remaining 29% is owned by Discovery’s current shareholders. In addition to their new Warner Bros Discovery common stock, AT&T shareholders continue to hold the same number of AT&T common stock they had prior to closing.
The transition took place under the rules of the Reverse Morris Trust. That is, an operation that allows a company to spin off properties, business divisions and other assets without the profits from the sale being taxed.
Who will be at the helm of Warner Bros Discovery
CEO of the new big in entertainment and streaming will be David Zaslav, who has been at the helm of Discovery since 2007.
On the day of the announcement of the merger, Zaslav said, “Today’s announcement represents a milestone not only for Warner Bros. Discovery but for all of our shareholders, distributors, advertisers, creative partners and most importantly, consumers at the level. global. Thanks to all of our assets and diversified business model, Warner Bros. Discovery offers the most complete portfolio of content, film, television and streaming brands in the world. ”
The comment from the CEO of AT&T
John Stankey, CEO of AT&T, also spoke about the birth of Warner Bros Discovery.
These are his words: “It is the dawn of a new era for connectivity and for AT&T. With this transaction closed, we expect to invest at record levels in our 5G and fiber growth areas, where we have strong momentum, as we work to become America’s leading broadband player.
At WarnerMedia, Discovery inherits an innovative and talented team and a dynamic, growing and global company that is well positioned to lead the transformation that is taking place in media and entertainment, direct-to-consumer distribution and technology. “