Discovery Closes $43 Billion Acquisition of AT&T’s WarnerMedia

Discovery completed its $43 billion acquisition of WarnerMedia from AT&T on Friday to form new company Warner Bros. Discovery.

WarnerMedia owns HBO, HBO Max, CNN, Warner Bros., DC Films, New Line Cinema, TBS, TNT, TruTV, Cartoon Network/Adult Swim, Turner Sports and Rooster Teeth, among other brands, and is part owner of the CW Network along with Paramount.

Discovery is the parent of Discovery Plus, Discovery Channel, HGTV, Food Network, TLC, Investigation Discovery, Travel Channel, Turbo/Velocity, Animal Planet, Science Channel and OWN (Oprah Winfrey Network).

Here is the new leadership structure for Warner Bros. Discovery, as announced by CEO David Zaslav on Thursday.

  • Adria Alpert Romm will serve as Chief People and Culture Officer, having held the same role at Discovery, Inc.
  • Casey Bloys continues as Chief Content Officer of HBO & HBO Max.
  • Bruce Campbell will assume the new role of Chief Revenue and Strategy Officer, with responsibility for US advertising sales, distribution revenue and content licensing; global corporate development and strategy; global streaming platform agreements; and the company’s legal affairs. He previously served as Discovery’s Chief Development, Distribution and Legal Officer.
  • Channing Dungey continues as Chairman of Warner Bros. Television Group.
  • Toby Emmerich continues as Chairman, Warner Bros. Pictures Group, with responsibility for Warner Bros. Pictures, New Line Cinema, DC-based films and Warner Bros. Feature Animation.
  • Kathleen Finch will assume a newly created role of Chairman and Chief Content Officer, US Networks Group, a new, consolidated organization comprising the company’s more than 40 US Networks. Nancy Daniels, Chief Content Officer, Discovery Factual Networks, will report to Finch, as will Brett Weitz, General Manager, TBS, TNT and truTV, and Tom Ascheim, President, Warner Bros. Global Kids, Young Adults and Classics, on the network side of his responsibilities. Finch will retain oversight for the Discovery Lifestyle Networks.
  • David Leavy will be Chief Corporate Affairs Officer, overseeing key business functions and groups, including corporate relations, global government relations and public policy, corporate marketing, global communications, corporate research, events and social responsibility.
  • Chris Licht will serve as Chairman & CEO of CNN Global, as previously announced.
  • Lori Locke will serve as Chief Accounting Officer, a position she held at Discovery. Locke will report to CFO Gunnar Wiedenfels, whose role was previously announced.
  • JB Perrette, formerly President and CEO, Discovery Streaming and International, will assume the role of CEO and President, Warner Bros. Discovery Global Streaming and Interactive Entertainment, with responsibility for HBO Max and discovery+, as well as all direct-to-consumer and gaming around the world. David Haddad, President Warner Bros. Games, will report to Perrette.
  • Savalle Sims will continue as General Counsel, a position she held at Discovery, reporting to Campbell.
  • Gunnar Wiedenfels will continue as Chief Financial Officer, as previously announced. In addition to overseeing finance, he will have oversight of the Company’s global enterprise technical operations as well as real estate and facilities.
  • Gerhard Zeiler will serve as President, International, with responsibility for the Company’s businesses across more than 200+ countries and territories. He has held the same role for WarnerMedia, and now adds responsibility for Discovery’s significant international footprint. With respect to direct-to-consumer and international content distribution strategy, Zeiler and his team will have a dotted line to Perrette.
  • The Company will name a new Chief Diversity, Equity and Inclusion Officer at a later date. The role will report jointly to the CEO, and Chief People and Culture Officer. The Company is also actively searching to fill the role of Chair and CEO for Warner Bros. Discovery Sports, reporting to the CEO. Lenny Daniels, President, Turner Sports and Patrick Crumb, President, Regional Sports Networks, will report into this position.

On Friday, it was revealed Jon Steinlauf will oversee U.S. ad sales for the new Warner Bros. Discovery, a key position at the company that is, like many other senior operating roles, going to an executive who has familiarity working with Zaslav.

Before these appointments were announced, several WarnerMedia execs exited their current roles: WarnerMedia CEO Jason Kilar; Andy Forssell, EVP and general manager of HBO Max; Ann Sarnoff, chair and chief executive officer of WarnerMedia’s studios and networks group; Jennifer Biry, chief financial officer; Jim Cummings, EVP, chief human resources officer; Tony Goncalves, EVP, chief revenue officer; Christy Haubegger, EVP, communications and chief inclusion officer; Jim Meza, EVP, general counsel, WarnerMedia; and Richard Tom, chief technology officer. In some cases, executives declined offers to stay in different capacities.

Discovery execs have already confirmed long-term plans to combine streaming platforms HBO Max and Discovery Plus as one platform under Warner Bros. Discovery.

Discovery ended 2021 with $4 billion in cash on its books, and it generated some $2.4 billion in free cash flow for the year. Warner Bros. Discovery will shoulder significant debt post-transaction, with Discovery executives vowing to reduce the leverage ratio from about 4.5 times earnings immediately after the deal closes to 2.5 to 3 times earnings within two years. Discovery raised $30 billion in senior unsecured notes in a debt offering to build up cash for the merger, the biggest bond raise in the company’s history.

At close of the WarnerMedia spinoff, AT&T expected to reap $43 billion (and the new WBD to assume up to approximately $43 billion of additional debt). AT&T aims to use the proceeds from the WarnerMedia spinoff to pay down net debt, which stood at $156.2 billion at the end of 2021.

On March 11, Discovery investors voted in approval of the acquisition, marking one of the final formal steps before the transaction can close. The merger was earlier approved by the U.S. Department of Justice, the European Commission and the boards of directors of both AT&T and Discovery.

More to come…

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