Warner Bros Discovery plans to separate into two listed companies. A streaming and studios company will consist of Warner Bros Television and Warner Bros Motion Picture Group, DC Studios, HBO, and HBO Max including its international sports offering, led by David Zaslav. A global networks company led by Gunnar Wiedenfels, will include CNN, TNT Sports in the United States, Discovery, free-to-air channels across Europe, and the Discovery+ online service, as well as most of the current company debt of $37 billion.
David Zaslav said: “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.” The streaming and studios business will focus on continuing to scale HBO Max.
Gunnar Wiedenfels, currently the chief financial officer of warner Bros Discovery, said: “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.” The global networks business will continue to develop Discovery+ and the new online offering for CNN.
The company said that the plan will unlock value for shareholders and create opportunities for both new businesses to thrive. The separation is expected to be completed by the middle of 2026.
Effectively, this unwinds the merger of WarnerMedia and Discovery, aiming to grow the studios and online business without the drag of the legacy television networks, although these will also have their own distinct direct to consumer online offerings.
The plan reflects that of Comcast to spin off most of its NBCUniversal cable networks into a separate company, Versant.
One possibility is that the separation of the Warner Bros Discovery businesses could allow some form of combination with those of Comcast as part of an anticipated consolidation of the media market.
So far the main beneficiary appears to be David Zaslav, who started out at NBCUniversal, before becoming chief executive of Discovery Communications in 2006, then of the merger with WarnerMedia, and now it seems of the most valuable bits of Warner Bros.