Warner Bros. Discovery, the merged entity of WarnerMedia and Discovery, started its first Nasdaq trading day on Monday at $24.08 per share, rocketed up to close to $26 per share, then closed at $24.78, up 1.27% — hardly a monumental increase, but encouraging all the same.
Meanwhile, former WarnerMedia parent AT&T’s stock price on Monday jumped 8%, to $19.67, as a probable result of Friday’s closure of the deal.
The Warner Bros. Discovery share price dipped to $24.48 in after-hours trading, but the start and finish were close enough that the day could hardly be called a roller coaster.
Monday was the first day of public trading for Warner Bros. Discovery. According to the original merger announcement, AT&T receives $43 billion in a combination of cash, debt securities and WarnerMedia’s retention of certain debt.
AT&T shareholders receive stock representing 71% of the new company; they received 0.24 WBD shares for each share of AT&T stock that they hold, according to Barron’s. Discovery shareholders will own 29% of the new company. The estimated value of the combined company is $130 billion.
The merger has also facilitated a financial windfall to Discovery Inc. CEO David Zaslav, who saw his executive compensation package increased more than sixfold to $246 million from $37.7 million in 2020.
Last May, Zaslav was announced as head of Warner Bros Discovery, the company created by merging Discovery Inc. and WarnerMedia, and signed a new employment agreement through the end of 2027. His new contract was packed with $190 million in stock options on top of $3 million in base pay. The merger of the two companies is expected to be completed in early Q2, most likely in April, the company has said. Zaslav’s finance chief Gunnar Wiedenfels will serve as chief financial officer of the new entity.
Zaslav is said to be on a tour of WarnerMedia offices nationwide this week and is expected to land in Burbank on Thursday, with layoffs as an expected topic on his agenda.
