NEW YORK, March 9, 2022 /PRNewswire/
-- Discovery, Inc. ("Discovery" or the "Company")
(Nasdaq: DISCA, DISCB, DISCK) announced today that Magallanes, Inc.
("Spinco"), a wholly-owned subsidiary of AT&T Inc.
("AT&T"), priced an offering of $30.0
billion aggregate principal amount of senior unsecured
notes, comprised of the following tranches (collectively, the
"Notes"): $1.75 billion aggregate
principal amount of its 3.428% Senior Notes due 2024, $500.0 million aggregate principal amount of its
3.528% Senior Notes due 2024, $1.75
billion aggregate principal amount of its 3.638% Senior
Notes due 2025, $500.0 million
aggregate principal amount of its 3.788% Senior Notes due 2025,
$4.0 billion aggregate principal
amount of its 3.755% Senior Notes due 2027, $1.5 billion aggregate principal amount of its
4.054% Senior Notes due 2029, $5.0
billion aggregate principal amount of its 4.279% Senior
Notes due 2032, $4.5 billion
aggregate principal amount of its 5.050% Senior Notes due 2042,
$7.0 billion aggregate principal
amount of its 5.141% Senior Notes due 2052, $3.0 billion aggregate principal amount of its
5.391% Senior Notes due 2062 and $500.0
million aggregate principal amount of its Floating Rate
Senior Notes due 2024. The Notes are being offered by Spinco
and certain selling securityholders, as applicable, in connection
with the previously announced combination of Discovery and the
business, operations and activities that constitute a portion of
the WarnerMedia segment of AT&T (the "WarnerMedia
Business") in a Reverse Morris Trust-type transaction (the
"Transaction"). In connection with the completion of the
Transaction, Discovery will be renamed Warner Bros. Discovery, Inc.
("WBD").
The Notes are to be issued in a private offering exempt from
registration in accordance with Rule 144A and Regulation S under
the Securities Act of 1933, as amended (the "Securities Act"). The
sale of the Notes is expected to be completed on or about
March 15, 2022, subject to customary
closing conditions.
Spinco intends to use the net proceeds from the sale of the
Notes offered by Spinco to fund the special cash payment to
AT&T and pay fees and expenses related to the Notes
offering. The selling securityholders will receive the Notes
offered by them from AT&T in exchange for certain outstanding
AT&T debt held or acquired by affiliates of the selling
securityholders. Prior to the consummation of the Transaction, the
Notes will be guaranteed on a senior unsecured basis by AT&T.
Upon consummation of the Transaction, AT&T will automatically
be released from all obligations under its guarantee and the Notes
will be guaranteed on a senior unsecured basis by WBD and certain
wholly-owned domestic subsidiaries of WBD.
The Notes are being offered only (1) to persons reasonably
believed to be qualified institutional buyers in reliance upon Rule
144A under the Securities Act and (2) outside the United States
to non-U.S. persons pursuant to Regulation S under the
Securities Act. The Notes have not been registered under the
Securities Act and may not be offered or sold in the United States absent registration or an
applicable exemption from registration requirements.
This press release does not constitute an offer to sell or a
solicitation of an offer to buy any securities, nor does it
constitute an offer, solicitation or sale in any jurisdiction in
which such offer, solicitation or sale is unlawful.
About Discovery
Discovery, Inc. (Nasdaq: DISCA, DISCB, DISCK) is a global leader
in real life entertainment, serving a passionate audience of
superfans around the world with content that inspires, informs and
entertains. Discovery delivers over 8,000 hours of original
programming each year and has category leadership across deeply
loved content genres around the world. Available in over 220
countries and territories and nearly 50 languages, Discovery is a
platform innovator, reaching viewers on all screens, including TV
Everywhere products such as the GO portfolio of apps;
direct-to-consumer streaming services such as discovery+, Food
Network Kitchen and MotorTrend OnDemand; digital-first and social
content from Group Nine Media; a landmark natural history and
factual content partnership with the BBC; and a strategic alliance
with PGA TOUR to create the international home of golf. Discovery's
portfolio of premium brands includes Discovery Channel, HGTV, Food
Network, TLC, Investigation Discovery, Travel Channel, MotorTrend,
Animal Planet, Science Channel, and the multi-platform JV with
Chip and Joanna Gaines, Magnolia
Network, as well as OWN: Oprah Winfrey Network in the U.S.,
Discovery Kids in Latin America,
and Eurosport, the leading provider of locally relevant, premium
sports and Home of the Olympic Games across Europe.
Cautionary Statement Concerning Forward-looking
Statements
Information set forth in this communication, including
financial estimates and statements as to the expected timing,
completion and effects of the proposed transaction between
AT&T, Spinco, and Discovery constitute forward-looking
statements within the meaning of the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. These estimates
and statements are subject to risks and uncertainties, and actual
results might differ materially. Such estimates and statements
include, but are not limited to, statements about the benefits of
the transaction, including future financial and operating results,
the combined Spinco and Discovery company's plans, objectives,
expectations and intentions, and other statements that are not
historical facts. Such statements are based upon the current
beliefs and expectations of the management of AT&T and
Discovery and are subject to significant risks and uncertainties
outside of our control. Among the risks and uncertainties that
could cause actual results to differ from those described in the
forward-looking statements are the following: the occurrence of any
event, change or other circumstances that could give rise to the
termination of the proposed transaction; the risk that Discovery
stockholders may not approve the transaction proposals; the risk
that the necessary regulatory approvals may not be obtained or may
be obtained subject to conditions that are not anticipated; risks
that any of the other closing conditions to the proposed
transaction may not be satisfied in a timely manner; risks that the
anticipated tax treatment of the proposed transaction is not
obtained; risks related to litigation brought in connection with
the proposed transaction; uncertainties as to the timing of the
consummation of the proposed transaction; risks and costs related
to the implementation of the separation of Spinco, including timing
anticipated to complete the separation, any changes to the
configuration of the businesses included in the separation if
implemented; the risk that the integration of Discovery and Spinco
being more difficult, time consuming or costly than expected; risks
related to financial community and rating agency perceptions of
each of AT&T and Discovery and its business, operations,
financial condition and the industry in which it operates; risks
related to disruption of management time from ongoing business
operations due to the proposed merger; failure to realize the
benefits expected from the proposed merger; effects of the
announcement, pendency or completion of the proposed merger on the
ability of AT&T, Spinco or Discovery to retain customers and
retain and hire key personnel and maintain relationships with their
suppliers, and on their operating results and businesses generally;
and risks related to the potential impact of general economic,
political and market factors on the companies or the proposed
transaction. The effects of the COVID-19 pandemic may give rise to
risks that are currently unknown or amplify the risks associated
with the foregoing factors.
These risks, as well as other risks associated with the proposed
transaction, are more fully discussed in the registration statement
on Form S-4 filed by Discovery with the Securities and Exchange
Commission ("SEC"), which includes a preliminary proxy
statement/prospectus, the proxy statement/prospectus filed by
Discovery with the SEC and first mailed to Discovery stockholders
on February 10, 2022, and the
registration statement on Form 10 filed by Spinco with the SEC,
which includes a preliminary information statement, in connection
with the proposed transaction. Discussions of additional risks and
uncertainties are contained in AT&T's and Discovery's filings
with the Securities and Exchange Commission. Neither AT&T nor
Discovery is under any obligation, and each expressly disclaims any
obligation, to update, alter, or otherwise revise any
forward-looking statements, whether written or oral, that may be
made from time to time, whether as a result of new information,
future events, or otherwise. Persons reading this announcement are
cautioned not to place undue reliance on these forward-looking
statements which speak only as of the date hereof.
Additional Information and Where to Find It
This communication may be deemed to be solicitation material in
respect of the proposed transaction between AT&T, Spinco, and
Discovery. In connection with the proposed transaction, Discovery
filed a registration statement on Form S-4 with the SEC containing
a preliminary prospectus of Discovery that also constitutes a
preliminary proxy statement of Discovery. The Form S-4 was declared
effective February 10, 2022 and the
proxy statement/prospectus was first mailed to Discovery
stockholders on February 10, 2022. In
addition, Spinco filed a registration statement on Form 10 with the
SEC containing a preliminary information statement. The Form 10 has
not yet become effective. After the Form 10 is effective, the
information statement will be made available to AT&T
stockholders. The information in the preliminary information
statement is not complete and may be changed. This communication is
not a substitute for the registration statements, proxy
statement/prospectus, information statement or any other document
which AT&T, Spinco or Discovery may file with the SEC.
STOCKHOLDERS OF AT&T AND DISCOVERY ARE URGED TO READ ALL
RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE REGISTRATION
STATEMENTS, THE PROXY STATEMENT/PROSPECTUS AND THE INFORMATION
STATEMENT WHEN IT BECOMES AVAILABLE BECAUSE THEY CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security
holders are able to obtain copies of the proxy statement/prospectus
as well as other filings containing information about AT&T,
Spinco and Discovery, without charge, at the SEC's website,
http://www.sec.gov. Copies of documents filed with the SEC by
AT&T or Spinco will be made available free of charge on
AT&T's investor relations website at https://investors.att.com.
Copies of documents filed with the SEC by Discovery will be made
available free of charge on Discovery's investor relations website
at https://ir.corporate.discovery.com/investor-relations.These
documents do not relate to the senior unsecured notes offering
referred to above, which is being conducted on a private
basis.
No Offer or Solicitation
This communication is for informational purposes only and is not
intended to and does not constitute an offer to sell, or the
solicitation of an offer to subscribe for or buy, or a solicitation
of any vote or approval in any jurisdiction, nor shall there be any
sale, issuance or transfer of securities in any jurisdiction in
which such offer, sale or solicitation would be unlawful, prior to
registration or qualification under the securities laws of any such
jurisdiction. No offer of securities shall be made except by means
of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended, and otherwise in accordance
with applicable law.
Participants in Solicitation
This communication is not a solicitation of a proxy from any
investor or security holder. However, AT&T and certain of its
directors and executive officers, and Discovery and its directors
and executive officers, may be deemed to be participants in the
solicitation of proxies from the holders of Discovery capital stock
and/or the offering of Discovery securities in respect of the
proposed transaction. Information about the directors and executive
officers of AT&T is set forth in the proxy statement for
AT&T's 2021 Annual Meeting of Stockholders, which was filed
with the SEC on March 11, 2021. Information about the
directors and executive officers of Discovery is set forth in the
proxy statement for Discovery's 2021 Annual Meeting of
Stockholders, which was filed with the SEC on April 30, 2021.
Additional information regarding the interests of these
participants can also be found in the Form S-4 filed by
Discovery with the SEC, which includes a preliminary proxy
statement/prospectus, the proxy statement/prospectus filed by
Discovery with the SEC and first mailed to Discovery stockholders
on February 10, 2022, and the registration statement on Form
10 filed by Spinco with the SEC, which includes a preliminary
information statement. These documents can be obtained free of
charge from the sources indicated above.
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SOURCE Discovery, Inc.
