Discovery Inc. (DISCA) has inched a step closer to completing the acquisition of WarnerMedia from AT&T (T). The transaction will result in the creation of Warner Bros Discovery, Inc. Discovery’s shareholders have approved proposals related to the acquisition, which is expected to close in the second quarter of 2022. DISCA shares fell 4.35% to close at $23.99 on March 11.
Discovery is a U.S. company that offers content across distribution platforms and digital distribution arrangements. Its Network segment owns and operates television networks. It also operates through the International Networks, Education and Other, and Corporate and Inter-segment Eliminations segments.
Merger
The global entertainment company’s shareholders voted to approve the charter amendment proposals. They also approved the share issuance proposal and advisory compensation proposal. The approvals mark the completion of the remaining conditions standing in the way of the proposed merger.
AT&T and Discovery’s boards of directors have already approved the transaction. The merger is expected to bring together WarnerMedia’s premium entertainment and Discovery’s non-fiction, international, and sports business.
Stock Rating
Last month, Credit Suisse analyst Douglas Mitchelson reiterated a Buy rating on Discovery Stock and lowered the price target to $52 from $61, implying 116.76% upside potential to current levels.
Consensus among analysts is a Strong Buy based on 6 Buys and 1 Hold. The average Discovery price target of $45.33 implies 88.95% upside potential to current levels.
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