According to Bloomberg, AT&T Inc. may be ready to add to its $85 billion dollar purchase of WarnerMedia three years ago by merging it with reality-tv producer Discovery Inc. Analysts are predicting the carrier would then spin off the group as a new entity to give it separation from AT&T’s core interest in telecommunications. Unnamed sources told Bloomberg a deal could come as early as this week.
AT&T’s media properties currently consist of CNN, HBO, TNT, the Cartoon Network, Turner and Warner Brothers. Discovery, with financial backing by cable mogul and investment guru John Malone, owns HGTV, Food Network, TLC and Animal Planet. A combined media group that includes Discovery is seen by market analysts as a solid competitor to Netflix Inc. and Walt Disney Co.
Recently appointed CEO John Stankey was formerly the CEO of Warner Media and instrumental in its purchase by AT&T. Since taking over, Stankey has focused on building the carrier’s wireless telecom assets by spending $23 billion in the FCC’s recent C-band auction, second to Verizon’s outlay of $45 billion.
Critics such as Elliott Management Corp., a shareholder in AT&T, have been vocal in their desire to see the carrier focus on its core business and, in doing so, could add value to the company by keeping a distance between their telecom and media interests.
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