Warner Bros Discovery to split into two companies
Warner Bros
. Discovery (WBD) announced plans to separate the company, in a tax-free transaction, into two distinct publicly traded companies. This strategic move aims to enable each new entity to maximise its potential and sharpen its focus within the dynamic
media landscape
, said the company in an official statement.
The separation will create—Streaming & Studios which will comprise Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios,
HBO
, HBO Max, and their legendary film and television libraries.
David Zaslav
, current President and CEO of Warner Bros. Discovery, will lead Streaming & Studios as its President and CEO.
While
Global Networks
, the entity will include premier entertainment, sports, and news television brands around the world, such as CNN, TNT Sports in the U.S., Discovery, top free-to-air channels across Europe, and digital products like the profitable
Discovery+
streaming service and Bleacher Report (B/R).
Gunnar Wiedenfels
, current CFO of Warner Bros. Discovery, will serve as President and CEO of Global Networks.
Both Zaslav and Wiedenfels will continue in their current roles at WBD until the separation is finalized, according to the press statement.
"The cultural significance of this great company and the impactful stories it has brought to life for more than a century have touched countless people all over the world. It's a treasured legacy we will proudly continue in this next chapter of our celebrated history,' said Zaslav. 'By operating as two distinct and optimized companies in the future, we are empowering these iconic brands with the sharper focus and strategic flexibility they need to compete most effectively in today's evolving media landscape.'
Gunnar Wiedenfels added, "This separation will invigorate each company by enabling them to leverage their strengths and specific financial profiles. This will also allow each company to pursue important investment opportunities and drive shareholder value. At Global Networks, we will focus on further identifying innovative ways to work with distribution partners to create value for both linear and streaming viewers globally while maximizing our network assets and driving free cash flow.'
Samuel A. Di Piazza, Jr., chair of the Warner Bros. Discovery Board of Directors, underscored the benefits for shareholders, stating, "We committed to shareholders to identify the best strategy to realize the full value of our exciting portfolio of assets, and the Board believes this transaction is a great outcome for WBD shareholders. This announcement reflects the Board's ongoing efforts to evaluate and pursue opportunities that enhance shareholder value.'
In a separate press release today, Warner Bros. Discovery announced the commencement of tender offers and related consent solicitations across its existing capital structure to enhance its debt portfolio. This will be funded by a committed bridge facility of $17.5 billion provided by J.P. Morgan, which is expected to be refinanced prior to the separation. Both companies will have a clear path to de-leveraging with significant cash flow and strong liquidity through cash and revolver availability. Additionally, Global Networks will hold up to a 20% retained stake in Streaming & Studios that it plans to monetize in a tax-efficient manner to enhance the de-leveraging of its balance sheet. The separation is expected to be completed by mid-2026.
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