Ta-da! Discovery just announced that its stockholders have approved its merger with AT&T’s WarnerMedia to create Warner Bros. Discovery, “a premier, global entertainment company” — marking the completion of one of the few remaining closing conditions for the merger.The transaction will bring together WarnerMedia’s entertainment, sports and news assets with Discovery’s leading nonfiction and international entertainment and sports businesses. Discovery CEO Davis Zaslav will lead the combined company. The two companies will take until April to wrap up the complex deal but meanwhile discussions can now accelerate on the management structure and organization of the business, including if and how its streaming services — including the new CNN+ launching March 29 — will be integrated.The ‘yes’ vote was not a surprise since major Discovery stakeholders John Malone and Advance/Newhouse had both previously agreed to back the deal.The $43-billion combination, which will create a massive new player on the media and entertainment landscape, is expected to close early in the second quarter. The boards of directors of both AT&T and Discovery have approved the transaction, as have regulators. Discovery is raising $30 billion in a debt offering closing later this month to pay for it. The deal now calls for AT&T to technically offload its former Time Warner entertainment assets to shareholders through a spinoff.The merger was announced in May, the new company name, logo and initial wordmark (“The stuff that dreams are made of”) in June.The new pure play content company, with no telecom assets in sight, will own one of the deepest libraries in the world with nearly 200,000 hours of programming and bring together 100+ brands including HBO, Warner Bros., Discovery, DC, CNN, WB Games, Turner Sports, Cartoon Network, HGTV, Food Network, TNT, TBS, Turner Classic Movies, Wizarding World, Adult Swim, Eurosport, Magnolia, TLC, Animal Planet, ID and others.Discovery stockholders also voted to approve the charter amendment proposals, share issuance proposal and the advisory (non-binding) compensation proposal. Discovery said preliminary voting results will be updated in an SEC filing late to reflect the final certification.AT&T acquired Time Warner in 2018 with much fanfare for $83 billion, after a drawn-out but ultimately victorious legal battle with the Dept. of Justice which had sued to block the deal. It found itself saddled with debt and facing ongoing big investments in content for streaming on the entertainment side along with massive outlays for spectrum and rolling out 5G. The combination confused some longtime investors and its moves to cut a long-steady dividend disappointed shareholders.AT&T management in fact is hosting a virtual investor day — ongoing now — to discuss its strategy and prospects. “Today, we’re focused on looking forward,” said CEO John Stankey.Discovery share are trending down 2% late morning (at about $24.57). AT&T is up 1.62% (at $23.57).
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