AT&T’s WarnerMedia and Discovery Inc. have closed their high-profile $43 million merger into new entity Warner Bros. Discovery, the companies announced on Friday.
“Today’s announcement marks an exciting milestone not just for Warner Bros. Discovery but for our shareholders, our distributors, our advertisers, our creative partners and, most importantly, consumers globally,” said Warner Bros. Discovery CEO David Zaslav in a statement.
“With our collective assets and diversified business model, Warner Bros. Discovery offers the most differentiated and complete portfolio of content across film, television and streaming,” he continued. “We are confident that we can bring more choice to consumers around the globe while fostering creativity and creating value for shareholders. I can’t wait for both teams to come together to make Warner Bros. Discovery the best place for impactful storytelling.”
Discovery stakeholders had approved the deal in mid-March.
The merger will place AT&T’s Warner Bros., CNN, Turner and Discovery’s stable of cable networks squarely under one roof — as well as streaming services Discovery+ and HBO Max, possibly giving the combined entity a fighting chance of moving into competition with Netflix and Disney+ among the leading streaming services.
The deal also combines WarnerMedia’s U.S. sports rights, including those with the NBA, MLB and March Madness, with Discovery international sports giant Eurosport.
The closure announcement comes after a long week of executive exits at WarnerMedia that included WarnerMedia CEO Jason Kilar, studios and networks group CEO and chair Ann Sarnoff and HBO max chief Andy Forssell. Warner Bros.
According to the original merger announcement, under the terms of the agreement, AT&T receives $43 billion in a combination of cash, debt securities and WarnerMedia’s retention of certain debt. AT&T shareholders will receive stock representing 71% of the new company. Discovery shareholders will own 29% of the new company. The estimated value of the combined company is $130 billion.
John Stankey, CEO of AT&T, thanked his soon-to-be former WarnerMedia colleagues in a memo on Friday that recounted the challenges and accomplishments during their short four years together.
“You are to be congratulated and commended,” Stankey wrote. “The road wasn’t easy or clear.”