Reuters

AT&T to spin off WarnerMedia in $43-billion Discovery merger, cuts dividend

Kenneth Li
Tue, February 1, 2022, 6:37 AM

(Reuters) -AT&T Inc said on Tuesday it will spin off WarnerMedia in a $43 billion transaction to merge its media properties with Discovery Inc and also cut its dividend by nearly half.

AT&T shareholders will own 71% of the new Warner Bros. Discovery company and will receive a 0.24 shares of Warner Bros. Discovery for each AT&T share they own. AT&T will have 7.2 billion diluted shares outstanding after the transaction closes.

The U.S. telecoms group will pay a dividend of $1.11 per share, down from $2.08 per share. This is at the lower end of an $8 billion to $9 billion range AT&T had forecast earlier. ... In premarket trading, AT&T shares were down 4%.

The deal to unwind AT&T's $85 billion purchase of Time Warner was announced early last year, but some financial details were not disclosed until Tuesday.

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