Warner Bros. Discovery (WBD.US) announced that it will spin off into two independent publicly listed companies by mid-next year, separating its streaming and film production Business from its television network Business.
According to Zhitong Finance APP, Warner Bros. Discovery Inc. (WBD.US) has announced that it will split into two independent publicly traded companies by mid-next year, separating its streaming and film production business from its television network business.
The company stated on Monday that the streaming and film production company will include Warner Bros. Television, Warner Bros. Film Group, DC Studios, HBO, and the HBO Max platform, as well as film library content, and will be led by CEO David Zaslav. Chief Financial Officer Gunnar Wiedenfels will oversee the newly established global networks company, which will include entertainment, sports, and news television brands such as CNN.
Recently, Warner Bros. completed a business restructuring, dividing into two major divisions to adapt to consumer trends shifting from traditional Pay TV to emerging online services. In the face of the costly streaming war with Netflix (NFLX.US), American media groups are working hard to improve profitability. Analysts predict that the Industry will experience a wave of consolidation as companies try to recover from the post-pandemic slump.
Comcast has taken a similar path, spinning off NBC Universal into Versant (which holds cable networks such as MSNBC and USA) and its remaining business (including the NBC broadcast network, streaming service Peacock, and Universal Studios theme parks).
Warner Bros. also announced it will raise $17.5 billion in transitional loans, expecting to complete its capital restructuring before the split. The global networks company will also Hold up to 20% of the streaming and film production business and will reduce debt through cashing out Shareholding.
As the parent company of channels such as CNN and HBO, Warner Bros. was formed in 2022 from the merger of AT&T's WarnerMedia and Discovery Inc. This deal resulted in a new company burdened with heavy debt, while its primary business of cable television faces a dual loss of viewers and advertising revenue.
Last Friday, the company's US stock rose 1.8% to $9.82, down 7.1% year-to-date. As of the time of writing, the stock was up 8% in pre-market trading on Monday.
