Warner Bros. Discovery has announced plans to split the media conglomerate into two separate publicly traded companies.
The streaming & studios company will consist of Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, HBO, and HBO Max, as well as their film and television libraries. Global Networks will include premier entertainment, sports and news television brands around the world including CNN, TNT Sports in the U.S., and Discovery, top free-to-air channels across Europe, and digital products such as the profitable Discovery+ streaming service and Bleacher Report (B/R).
The move marks a dramatic reversal of the company’s 2022 merger between Warner Media and Discovery, reflecting the growing pressure to prioritise streaming growth while shedding the declining influence of legacy TV networks.
David Zaslav, president and CEO of Warner Bros. Discovery, will serve as president and CEO of Streaming & Studios. Gunnar Wiedenfels, CFO of Warner Bros. Discovery, will serve as president and CEO of Global Networks. Both will continue in their present roles at WBD until the separation.
Streaming & Studios
The company will be comprised of Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, HBO and HBO Max (including its international sports offering), Warner Bros. Games, Tours, Retail and Experiences, as well as studio production facilities in Burbank and Leavesden.
Streaming & Studios will focus on continuing to scale HBO Max, which is now in 77 markets with important new market launches planned for 2026, and build on its global momentum, investing in HBO’s world-class programming which differentiates and drives the platform, and prioritizing the operating principles that have put the Studios on a path back to their target of at least $3 billion in annual adjusted EBITDA.
Global Networks
Global Networks will encompass a global portfolio of entertainment, sports and news television networks and brands as well as their digital products. Per the an official release, these assets reach 1.1 billion unique viewers in 68 languages across 200 countries and territories, while operating with industry-leading margins and robust free cash flow conversion. As a worldwide leader in live television, Global Networks will have the expertise, reach and ongoing financial profile to pursue opportunities such as investing in international growth opportunities, elevating its live content offerings in sports and news, and growing digital extensions of its network brands, such as Discovery+, B/R, and CNN’s new streaming offering.
Transaction details
The companies plan to implement arm’s length transition services and commercial agreements post-separation to facilitate the transition and maintain continued operational efficiencies.
Each company will have well-capitalized structures to support their businesses.
In a separate press release, Warner Bros. Discovery has announced the commencement of tender offers and related consent solicitations across its existing capital structure to enhance its debt portfolio, which will be funded by a committed bridge facility of $17.5 billion provided by J.P. Morgan.
The bridge facility is expected to be refinanced prior to the separation. Both companies will have a clear path to de-leveraging with significant cash flow and strong liquidity through cash and revolver availability. In addition, Global Networks will hold up to a 20% retained stake in Streaming & Studios that it will plan to monetize in a tax-efficient manner to enhance the de-leveraging of its balance sheet.
The separation is expected to be completed by mid-2026, subject to closing and other conditions, including final approval by the Warner Bros. Discovery Board, receipt of tax opinions and/or a private letter ruling from the Internal Revenue Service with respect to the tax-free nature of the transaction for U.S. federal income tax purposes, and market conditions.
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.”
Wiedenfels noted: “At Global Networks, we will focus on further identifying innovative ways to work with distribution partners to create value for both linear and streaming viewers globally while maximizing our network assets and driving free cash flow.”
