
Shares jump 13% after reorganizing statement

Follows path taken by Comcast's new spin-off company
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Challenges seen in selling debt-laden linear TV networks
(New throughout, includes information, background, comments from industry experts and analysts, updates share costs)
By Dawn Chmielewski, Deborah Mary Sophia and Aditya Soni
Dec 12 (Reuters) - Warner Bros Discovery on Thursday chose to separate its declining cable television services such as CNN from streaming and studio operations such as Max, preparing for a potential sale or spinoff of its TV organization as more cable television customers cut the cord.
Shares of Warner jumped after the business stated the brand-new structure would be more deal friendly and it expected to finish the split by the middle of 2025. Warner shares closed at $12.49, up more than 15%.
Media business are thinking about choices for fading cable television TV companies, a longtime cash cow where incomes are eroding as countless customers embrace streaming video.
Comcast last month unveiled strategies to divide the majority of its NBCUniversal cable networks into a brand-new public company. The new company would be well capitalized and positioned to obtain other cable networks if the industry consolidates, one source told Reuters.
Bank of America research expert Jessica Reif Ehrlich wrote that Warner Bros Discovery's cable television service possessions are a "very sensible partner" for Comcast's brand-new spin-off company.
"We strongly think there is potential for relatively large synergies if WBD's linear networks were combined with Comcast SpinCo," wrote Ehrlich, using the industry term for standard television.

"Further, we think WBD's standalone streaming and studio properties would be an attractive takeover target."
Under the new structure for Warner Bros Discovery, the cable business consisting of TNT, Animal Planet and CNN will be housed in a system called Global Linear Networks.
Streaming platforms Max and Discovery+ will be under a separate division along with movie studios, including Warner Bros Pictures and New Line Cinema.
The restructuring shows an inflection point for the media market, as financial investments in streaming services such as Warner Bros Discovery's Max are lastly paying off.
"Streaming won as a habits," stated Jonathan Miller, president of digital media investment firm Integrated Media. "Now, it's winning as a service."
Brightcove CEO Marc DeBevoise stated Warner Bros Discovery's new corporate structure will distinguish growing studio and streaming possessions from lucrative but diminishing cable television business, providing a clearer financial investment photo and likely setting the phase for a sale or spin-off of the cable unit.
The media veteran and consultant forecasted Paramount and others may take a similar course.

CEO David Zaslav, a veteran deal-maker who led Discovery through its acquisition of Scripps Networks Interactive before acquiring the even bigger target, AT&T's WarnerMedia, is positioning the company for its next chess move, composed MoffettNathanson analyst Robert Fishman.
"The question is not whether more pieces will be moved or knocked off the board, or if more debt consolidation will take place-- it is a matter of who is the buyer and who is the seller," wrote Fishman.
Zaslav signaled that situation throughout Warner Bros Discovery's financier call last month. He said he expected President-elect Donald Trump's administration would be friendlier to deal-making, opening the door to media market debt consolidation.
Zaslav had actually taken part in merger talks with Paramount late last year, though an offer never ever emerged, according to a regulative filing last month.
Others injected a note of caution, keeping in mind Warner Bros Discovery brings $40.4 billion in debt.
"The structure modification would make it simpler for WBD to offer off its direct TV networks," eMarketer analyst Ross Benes stated, describing the cable TV organization. "However, discovering a buyer will be difficult. The networks are in debt and have no indications of growth."
In August, Warner Bros Discovery made a note of the worth of its TV assets by over $9 billion due to uncertainty around costs from cable and satellite suppliers and sports betting rights renewals.
Today, the media business revealed a multi-year deal increasing the general costs Comcast will pay to disperse Warner Bros Discovery's networks.
Warner Bros Discovery is sports betting the Comcast arrangement, together with an offer reached this year with cable and broadband provider Charter, will be a design template for future negotiations with distributors. That could help stabilize rates for the domestic pay TV market. (Reporting by Deborah Sophia and Aditya Soni in Bengaluru, Dawn Chmielewski in Los Angeles; Editing by Shilpi Majumdar, Arun Koyyur, Keith Weir and David Gregorio)
