BT has struck a deal with the US media company Warner Bros Discovery to create a joint venture pay-TV sport business, which will bring together rights to sports including the Premier League, the Champions League and the Olympics, worth as much as £633m to the telecoms operator.In February, BT entered into exclusive talks with the US firm to merge BT Sport with the Discovery-owned Eurosport, which broadcasts a wide range of sports including tennis and cycling and holds the pan-European rights to the Olympics in the UK.“We have finalised the sports joint venture with Warner Bros Discovery to improve our content offering to customers, aligning our business with a new global content powerhouse,” said Philip Jansen, chief executive of BT.Under the terms of the 50:50 joint venture, which will be operated by Warner Bros Discovery, BT will receive a £93m payment in instalments over three years after completion of the deal.BT will also receive up to £540m based on performance of the operation over a period of four years. This could pay out sooner if either the £540m performance cap is hit, or Warner Bros Discovery trigger a call option to take full control.JB Perrette, chief executive of Warner Bros Discovery’s global streaming and interactive entertainment businesses, said the company’s intention was to buy out BT at some point.The two companies said that the BT Sport and Eurosport brands would both initially continue to operate in the UK market “before being brought together under a single brand in the future”.“Our growing portfolio of premium entertainment content promises to deliver consumers a richer and deeper content proposition, not only providing greater value from their subscriptions but bringing sport to a wider entertainment audience,” said Andrew Georgiou, president and managing director of Warner Bros Discovery sports Europe.The company announced the deal as part of full-year results with BT reporting a 2% dip in revenues to £20.8bn, and a 9% increase in profits to £1.96bn, for the year to the end of March.BT, which has raised its cost savings target by £500m to £2.5bn by the end of 2025, has spent billions on sports rights to drive the growth of BT Sport since it was launched a decade ago to stem the loss of millions of broadband customers enticed by its rival Sky’s offers bundling internet connectivity with sport and entertainment programming.“As a global sports and entertainment broadcaster Warner Bros Discovery is the perfect partner to work with us to take BT Sport to the next stage of its growth,” said Marc Allera, chief executive of BT’s Consumer operation.BT, which has had to seek clearance from the Premier League and Champions League to push through the change in ownership, has also extended a reciprocal channel supply deal with Sky that is crucial to its sports broadcasting business until 2030.
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