After 10 months of the announcement from AT&T and Discovery of the spin-off of WarnerMedia from AT&T and its merger under Discovery, it is finally happening. Today, shortly after trading ceases in the New York stock exchanges, both broadcasters will combine to create the second-largest media company in the world, after The Walt Disney Company and overtaking Paramount Global. The merger, a Reverse Morris Trust, will be structured as a 71%/29% venture between AT&T and Discovery shareholders, respectively, and AT&T will receive US$43 billion in cash and debt as part of the merger, as part of John Stankey’s massive reorganization plans to restructure the finances of the telco, after a rocky period with Randall Stephenson at the helm (which included its acquisition of then-Time Warner). Discovery is also looking for additional investment to receive an additional US$15 billion dollars in debt, and is making a dividend so that shareholders get a stake on either one or both companies.
The combined company will have Discovery CEO David Zaslav as CEO and Chairman, with current WarnerMedia CEO Jason Kilar leaving the company altogether. Also leaving are Ann Sarnoff and Andy Forsell, who are leaving the Studios and Networks division and HBO Max, respectively. Six other big executives are also affected.
The company will be switching to a streaming-first approach like most of its competitors, but Zaslav said that the company plans a more wise investment in content, with spending being restricted to around US$10 billion in place of the current US$20 billion both companies spend on content. The result is a plan to compete in the streaming wars in a much more profitable way, even if the group has three streaming services: HBO Max, Discovery+ and the recently launched CNN+. The group plans to bundle HBO Max and D+ in the run-up of a possible merger to create a super-OTT platform, as well as winding off CNN+ and reducing the levels of staff for the service, considered one of the biggest legacies of Jeff Zucker’s controversial period as CNN Worldwide CEO.
On Thursday, the merged company’s leadership team has been announced, a final step before the merger gets going today. The leadership team mostly composed of Discovery executives, but also features some holdovers from the soon-to-be-defunct WarnerMedia:
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David Zaslav, CEO
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Adria Alpert Romm, SEVP of Human Relations and Global Diversity
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Gunnar Wiedenfels, CFO
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Lori Locke, CAO (Chief Accounting Officer)
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David Levy, Chief Corporate Affairs Officer
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Bruce Campbell, Chief Revenue and Strategy Officer
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Savalle Sims, General Consuel
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Chris Licht, CEO and President of CNN Worldwide
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Kathleen Finch, president of US Cable Networks, overseeing Discovery’s and Turner’s entertainment and factual channels (Nancy Daniels, Brett Weitz and Tom Ascheim stay put as directors of their respective channels and divisions, as is Finch leading the lifestyle and true crime networks)
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Casey Bloys, CCO, HBO and HBO Max
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Toby Emmerich, Chairman, Warner Bros. Pictures
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Channing Dungey, Chairwoman, Warner Bros. Television
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Gerhard Zeiler, CEO, Warner Bros. Discovery International
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JB Perrette, CEO, HBO Max and Discovery+
The company will also nominate a Chief Diversity, Equity and Inclusion Officer to compliment Adria Alpert Romm’s job (she might be retiring by the end of the year), and a new global Chair and CEO for Sports, which will oversee Turner Sports, TNT Sports Latin America and Eurosport.
Additionally, the Board of Directors has been announced, which will be represented by Zaslav, John Malone, former BET chair Debra Lee, former PwC CEO Samuel A. DiPiazza Jr. (which will be Chairman of the new merged company), Li Haslett Chen (CEO of tech platform Narrativ, Barclays senior advisor Rich Fisher, Sixth Street Partners senior advisor Fazal Merchant, former Macy’s CEO Paula Price, Redpoint Ventures managing director Geoffrey Yang, Advance/Newhouse execs Steve Miron and Steve Newhouse, Hilltop Investments managing director Bob Bennett and Allen & Co. MD and EVP Paul Gould.
In the ANZ region, Warner Bros. Discovery will operate the local versions of Cartoon Network, Boomerang, Discovery, Discovery Turbo, Animal Planet, ID, and TLC, as well as the Discovery New Zealand division, which operates Three, Bravo, Eden, Rush, Living and ThreeNow, and an existing partnership with Nine for the 9Rush diginet (talk about Discovery NZ and 9Rush shall be redirected to their respective topics). HBO Max will still not launch on the ANZ region, as it continues its existing deals with Foxtel/Binge and Sky/Neon.
Globally, Warner Bros. Discovery will have a grand portfolio of brands: Adult Swim, All3Media (JV with Liberty Global), Alloy Entertainment, Animal Planet, Bleacher Report, Boomerang, Cartoon Network, Cartoonito, Cinemax, CNN Worldwide, The CW (with Paramount), DC Comics, Discovery Channel, Discovery Family (with Hasbro/eOne), the DMAX network, DKISS (Spain), Eurosport, Eve (East Asia), Fatafeat (MENA), HBO, HGTV, HLN, Investigation Discovery, Food Network (with Nexstar), Grupa TVN Discovery (Poland), Joyn (Germany, with ProSiebenSat.1 Media), the Magnolia Network (with Chip and Joanna Gaines), Megamedia (Chile, with the Bethia holding company), Motor Trend (with Source Interlink), OWN (with Harpo Studios), Quest, Really, Rooster Teeth, the Science Channel, TBS, Tele 5 (Germany), TLC, TNT, Three (New Zealand), TruTV, Travel Channel, Turner Classic Movies, Turner Sports, Warner Bros., and Warner TV Europe, among many other brands.
