Split itself in two or sell off? Parent of CNN and TNT weighs its options.
In its search to succeed in the evolving media landscape, will the parent company of CNN and TNT split itself into two companies, or sell itself in whole or in parts to one of its biggest rivals?
For much of this year, it’s looked like Warner Bros. Discovery was set on splitting itself into two publicly traded businesses. One called Warner Bros. would feature its namesake studio, HBO and the HBO Max streaming services, and the DC Comics film and television studio. The other, to be called Discovery Global, would feature legacy cable networks, including CNN, TNT, TBS and Discovery.
But on Tuesday, Warner Bros. Discovery said it would consider other options.
Warner Bros. Discovery, the product of the 2022 blockbuster media combination, has been in a state of near constant change since its founding.
The company said Tuesday it has received “unsolicited interest” from multiple parties for both the entire company or pieces of its empire. It has begun reviewing alternatives to “identify the best path forward” toward profitability, according to a news release.
The announcement comes about a month after The Wall Street Journal reported Paramount Skydance was preparing a majority cash bid for the entirety of WBD, including its cable networks and movie studio.
If completed, a marriage of Paramount Skydance and Warner Bros. Discovery would unite two of Hollywood’s most influential media and entertainment conglomerates, with wide-ranging properties that include DC Comics; the “Harry Potter,” “Mission: Impossible” and “Star Trek” franchises; and Atlanta-founded cable giants CNN and TBS; among others. Neither Paramount nor WBD has publicly commented on the report at the time.
WBD said it would continue to pursue its split while evaluating other offers.
In December, WBD announced plans to divide its business into two segments, a move that followed a $9.1 billion write-down on the book value of its cable networks. A write-down often occurs if assets acquired in a deal do not generate the financial results that were expected of them at the time of purchase.
Then in June, WBD said it would formally split the company into two publicly traded entities.
Now, it is broadening the scope of its search for new alternatives. The review will include continuing to complete the planned separation by mid-2026, a transaction for the entire company or separate transactions for its Warner Bros. or Discovery Global businesses. It will also consider an alternative separation structure that would enable a merger of Warner Bros. and spinoff of Discovery Global to their shareholders.
In the Tuesday news release, David Zaslav, president and CEO of Warner Bros. Discovery, said the company makes “important strides to position our business to succeed in today’s evolving media landscape.” It took the step of preparing to separate itself because it “strongly believed this was the best path forward.”
There is no deadline set for completion of the strategic alternatives review process.
With so much unsettled, it is unclear what effects a split or a sale of WBD, in whole or in parts, would have on workers in any of its divisions, including those in Atlanta.
About the Author
Savannah Sicurella is an entertainment business reporter with The Atlanta Journal-Constitution.
