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The WarnerMedia-Discovery deal was structured to make a future sale easier

Mount Equity Group Tokyo, Japan > News > Tech > The WarnerMedia-Discovery deal was structured to make a future sale easier

Liberty Media’s John MaloneMichael Kovac | Getty Images

Long-time employees of WarnerMedia have been through so many spinoffs and mergers that Monday’s announcement of its impending separation from AT&T and combination with Discovery amounted to gallows humor.

“You just have to laugh,” said one veteran employee.

Given that context, it may not be surprising that WarnerDiscovery — the leading candidate for a name, according to a person familiar with the matter — is structuring itself for a future sale.

The key indicator that future chief executive David Zaslav is already considering a sale down the road — assuming the merger passes regulatory approval — is John Malone’s decision to give up his Discovery super-voting shares to merge with WarnerMedia.

Based on the latest proxy statemen filed on Apr. 30, Malone owned 6.2 million Discovery Class B shares, giving him a total of 26.5% voting control — the most of any single owner. He held 19.5 million shares in total, amounting to a 4% economic interest. His voting control was much greater because of the super-voting stock.

Malone agreed to turn in those shares for common equity because he wanted to give a combined WarnerDiscovery flexibility to sell itself in the future — most likely to a