With Amazon spending $13 billion, and Apple TV+ spending $6.5 billion, the cost of failure is not negligible.Īcquiring TimeWarner would make up 4-6% of these companies' value, provide profits off the bat, and give them a top-tier streaming services competitive with both Netflix ( NFLX) and Disney. All these companies have gotten some traction as a result of their size but have struggled to make significant traction. Google is doing the same through YouTube TV. As we've discussed before, large tech companies have considered such acquisitions, and we continue to believe it's a possibly.Īpple and Amazon are both working hard to build new streaming services. Specifically from large technology companies. Acquisition InterestĪnd because of those assets, we expect there to be significant interest around potentially acquiring WBD. This unique asset portfolio and synergies are the product of decades of content creation, an asset that's near impossible to replicate. Expected run-rate cost savings are expected to be more than $3 billion annualized which would be a substantial part of the combined company's earnings. Those assets could drive significant synergies. The company has premium sports rights and numerous impressive assets.
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The company will have one of the largest TV studio and movie studios and will truly be competitive with only Disney ( DIS) given the massive size. The combined company will be available across the world with a massive 200k hours of video content. The combined company has an impressive portfolio and will have the ability to achieve strong synergies.ĪT&T Asset Portfolio - AT&T Discovery Investor Presentation
The current value placed by the market on each share is $24.14/share implying a market capitalization of roughly $58 billion. Putting it together that means $58 billion in total debt for the company. The new company will be 29% owned by Discovery shareholders and 71% owned by AT&T shareholders.ĪT&T will receive $43 billion through a variety of different factors which will combine with the acceptance of $15 billion of Discovery debt. 11, the new company will begin trading under WBD. For the week it traded with a separate T.WI ticker, and on Friday the transaction closed. The Reverse Morris Trust transaction broke out on April 5. The transaction is a semi-complex transaction but from a shareholder perspective it boils down to a few key details.ĪT&T TimeWarner Transaction - AT&T Discovery Investor Presentation They will own 71% of the combined company, and AT&T will also receive $40.4 billion in cash on top of WBD's ownership of certain debt. 5, will receive 0.241917 shares of WBD for each share of AT&T held. AT&T ( NYSE: T) shareholders, as of close on Apr.
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