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Mubasher: AT&T, a U.S. telecom company, has entered into a definitive agreement to merge its WarnerMedia assets with Discovery's nonfiction and international entertainment and sports businesses to form a premier and standalone global entertainment company.
Under the agreement, AT&T, expected to hold 71% of the new company, would receive $43 billion in a combination of cash, debt securities, and WarnerMedia's retention of certain debt, according to a press release on Monday.
The new company is expected to have 2023 revenues of around $52 billion and adjusted earnings before interest, tax, depreciation, and amortisation (EBITDA) of about $14 billion.
In addition, the new company will be led by Discovery's CEO, David Zaslav, and supervised by a 13 member board, seven of which will be appointed by AT&T, including the chairperson.
AT&T owns CNN, HBO, Warner Bros., TNT, Cartoon Network, and DC Entertainment after it acquired Time Warner, while Discoverys channels include Animal Planet, TLC, and the Discovery Channel.
Commenting on the agreement, Zaslav said: "We believe everyone wins...consumers with more diverse choices, talent and storytellers with more resources and compelling pathways to larger audiences, and shareholders with a globally scaled growth company committed to a strong balance sheet that is better positioned to compete with the world's largest streamers."
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