AT&T detailed its WarnerMedia production plans on Friday, with investors eventually expecting to receive a share of the new streaming media entity for every four shares they own in AT&T.
Underway Rotating Warner Media’s business In association with Discovery Inc. DISCA,
Which executives said would allow AT&T to refocus attention on its core communications efforts. The company expects the deal to close in April, and executives have announced plans to distribute the dividend to its investors on April 5th at the close of business.
AT&T clarified in a statement Friday that those who own AT&T shares as of the end of trading April 5 will be able to acquire WarnerMedia SpinCo shares that represent 100% of AT&T’s interest in the business. After the deal closes, expected sometime in April, investors will receive an estimated 0.24 shares of newly created WarnerBros. Discover every AT&T share they own.
The shares created represent approximately 71% of WarnerBros. The discovery, which will be traded under ticker symbol “WBD” after the sub-display is completed. The company stated that shareholders “do not need to take any action” as SpinCo shares will be automatically exchanged on the closing date of the deal.
The potential period between the dividend payout and the closing of the deal can create confusion for anyone who wants to buy or sell shares. The company indicated that between April 4, the trading day prior to the record date of its spin-off, and the closing of the merger with Discovery, there will be two AT&T common stock markets on the New York Stock Exchange.
Those who choose to sell a share of AT&T’s common stock through the “normal way” market will sell both AT&T stock and the right to receive WarnerBros. Discovery shares through the deal. Those who participate in the “ex-distribution” market will sell shares of AT&T while retaining the right to receive WarnerBros. discovery arrow.
In addition, in the two-way trading window, those who wish to hold shares of AT&T while selling the right to receive WarnerBros. The discovery could use a temporary option when it is released which will be available on NASDAQ.
While AT&T shareholders will still own the same number of AT&T shares after the deal closes that they owned just prior to the deal closing, the company’s share price is expected to be adjusted after the deal is completed, reflecting the pop-up offer.
The AT&T Board of Directors also announced a second-quarter dividend of 27.75 cents per share, its first quarterly dividend under Reduced annual payments set by executives last month. Dividends will be paid on May 2 to shareholders of record effective April 14.