Warner Bros. Discovery Separates Streaming from Cable TV Network
Mark Mahaney, senior managing partner at Evernote ISI, explains why Netflix stocks are a good investment despite the competition from streaming competitors on “Varney & Co.”
Warner Bros Discovery announced Monday that it will split into two companies by separating the studio Streaming Business From the cable TV network.
That’s the parent company of HBO and CNN It is divided into two companies That move is expected to provide more space to expand content production without being squeezed by the decline in the company’s cable network, so to help better compete with streaming.
Warner Bros. Discovery CEO David Zaslav will lead streaming and studio business after the split, with CFO Gunnar Wiedenfels leading global network unit.
“By operating as two differently optimized companies in the future, we are reinforcing these iconic brands the focus and strategic flexibility needed to compete most effectively in today’s evolving media situation,” Zaslav said.
“Sesame Street” InkStreaming is a deal with Netflix
Warner Bros. Discovery will split the studio and streaming business from cable television networks in transactions that close next year. (Photographer: Getty Images / Yoka via Getty Images / Bloomberg)
The corporate division comes several years after the merger of WarnerMedia and Discovery in 2022; Tax-free transactionsIt is expected to be completed by mid-2026.
WBD shares rose 8% during morning trading.
The company laid the foundation for potential sales or spinoffs Cable TV The assets announced the separation of streaming and studio operations in December.
| Ticker | safety | last | change | change % |
|---|---|---|---|---|
| WBD | Warner Bros. Discovery Inc. | 10.52 | +0.69 |
+7.08% |
Disney cuts hundreds of TV and movie jobs amid streaming expansion
This split will align the company with Comcast. Comcast is a major source of cable television networks.
Jessica Leeff Erich, a research analyst at Bank of America, said Warner Bros Discovery’s cable television assets are “a very logical partner” of Comcast’s new spinoff company.
Disney Announces New Consumer Direct ESPN Streaming Service at a price tag of $29.99
David Theslav, CEO of Warner Bros Discovery, announced the split. (Michael M. Santiago / Getty Images / Getty Images)
WBD also launched bid offers on Monday Restructure existing debtsis funded by a $17.5 billion bridge facility provided by JPMorgan.
The bridge loan is expected to be refinanced prior to the planned separation, and the company added that its global network division will hold up to 20% stake in streaming and studios.
Click here to get your Fox business on the go
JPMorgan and Evercore advise WBD on the transaction, while Kirkland & Ellis serve as lawyers.
Reuters contributed to this report.