Warner Bros Discovery weighs sale of music library to pare debt

Warner Bros Discovery is exploring a sale of its music library that may very well be valued at greater than $1bn, based on individuals acquainted with the matter, the newest transfer by chief govt David Zaslav to scale back debt on the sprawling Hollywood empire.

Since taking management after combining WarnerMedia together with his Discovery final yr, Zaslav’s workforce has been scouring the leisure group — which spans HBO, the Warner Bros film studio and CNN — to seek out locations to chop into its $50bn in debt.

The Warner Bros film studio created a music division within the Fifties. In 2004 mum or dad firm Time Warner offered the music division, however the group retained its copyrights to a trove of songs, such because the soundtracks to the Batman movies.

Warner is buying round this catalogue to potential consumers because it tries to capitalise on a sizzling marketplace for music copyrights, based on three individuals acquainted with the matter. The property may very well be price greater than $1bn, one of many individuals stated.

The method is in early phases and any deal would maintain stipulations over entry to and use of sure soundtracks, stated one individual near the state of affairs.

The transfer comes after Zaslav’s workforce has axed outstanding initiatives such because the CNN Plus streaming service, JJ Abrams’s HBO sequence Demimonde and the film Batgirl through the last phases of its manufacturing.

Chief monetary officer Gunnar Wiedenfels earlier this month defended these selections. “We shaved off a variety of the surplus final yr, and I believe that’s one thing that everybody else within the business goes to undergo,” he advised an investor convention. “We’re coming from an irrational time of overspending with very restricted concentrate on return on funding.

“We’re simply constantly and constantly how we’re working the enterprise . . . What is sensible? What doesn’t make sense?”

After a bruising 2022 when the inventory misplaced greater than half of its worth, shares in Warner Bros Discovery have elevated by greater than a 3rd this yr, as buyers guess that the worst is over when it comes to losses and restructuring prices.

“At this level, the vast majority of heavy lifting (associated to restructuring costs and many others) has been accomplished,” stated Financial institution of America analyst Jessica Ehrlich.