A brand-new deal pushes a AT&T spin-off of Warners with Discovery onto the front page today.
The first day of trading shows some appetite for these new shares that demonstrate a plan that had been in the works for a long time.
In a $43 billion merger, AT&T property WarnerMedia and Discovery have now become one.
“Warner Bros Discovery Inc. will trade on the Nasdaq under the ticker symbol ‘WBD’ today, with CEO David Zaslav CEO at the helm,” writes Martin Baccardax for The Street today. “AT&T shareholders will own 71% of the combined group, with the remaining 29% taken-up by Discovery shareholders. The move leaves the newly-created group with a fleet of media assets including the Discovery Channel, Warner Bros. Entertainment, CNN, HBO and the Cartoon Network as well as lucrative streaming services such as HBO Max and Discovery+.”
“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,” Zaslav said in a press statement. “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.”
AT&T estimates an annual dividend of $8 billion.
For reference, the company is reported to have around $200 billion in free cash flow.
Meanwhile, AT&T promotes evolution of its 5G and wireless systems with a plan to double its fiber networking within the next few years.
“To reach these goals, AT&T expects to add 3.5 million to 4 million customer locations each year,” wrote Stephen Hardy at Lightwave March 14. “Concurrently, the company plans to phase out its copper-based broadband infrastructure. By 2025, AT&T believes that 75% of its network footprint will be served via fiber and 5G and that it will have reduced its copper services footprint by 50%.”
Look for more as telecom advances.