AT & T Inc. elaborated on WarnerMedia’s spin-off plans on Friday, and investors were expected to eventually receive a share of the new streaming media entity for every four AT & T shares they own.
AT & T T, + 2.19%, in combination with Discovery Inc. DISCA, + 0.85%, is in the process of spinning off the WarnerMedia business. The company expects the transaction to close in April, and management announced plans to pay dividends to investors at the close of business on April 5.
AT & T said in a Friday release that anyone who owns AT & T’s shares at the end of the transaction on April 5 will receive a 100% stake in WarnerMediaSpinCo’s stake in AT & T’s business. .. Scheduled for the end of April after the transaction closes, investors will receive an estimated 0.24 shares of the newly created Warner Bros. Discovery of each share of AT & T they own.
See also: AT & T publishes new guidance as Warner Media spins approach
The created share is equivalent to about 71% of Warner Bros. Discovery. After the spin-off is complete, it will be traded on the ticker symbol “WBD”. Shareholders “do not have to do anything,” the company reported, as SpinCo shares are automatically exchanged on the day the transaction closes.
The potential period from a stock dividend to the closing of a transaction can cause confusion for anyone who wants to buy or sell stock. The company states that the New York Stock Exchange has two markets for AT & T’s common stock between April 4, the trading day prior to the record date for spin-off distribution, and the completion of the merger with Discovery. rice field.
Those who choose to sell AT & T’s common stock through the “normal way” market will sell both AT & T’s stock and their right to receive Warner Bros. Discovery is shared through transactions. Those who participate in the “Distribution” market will sell AT & T shares while preserving their right to Warner Bros. Pictures. Discovery share.
In addition, in the two-way trading window, anyone who wants to hold AT & T shares while selling the right to receive Warner Bros. Discovery has temporary issuance options available on Nasdaq.
AT & T shareholders will own the same number of AT & T shares after the transaction as they did just before the transaction, but the company’s share price is expected to be adjusted after the transaction closes, reflecting the spin-off.
AT & T’s board also declared a second-quarter dividend of 27.75 cents per share. This is the first quarter dividend based on the annual dividend reduction outlined last month by executives. Dividends will be paid ed shareholders as of April 14th on May 2nd.