Introductory Note.
As previously announced, on May 17, 2021, AT&T Inc., a Delaware corporation (“AT&T”), and Magallanes, Inc., a Delaware corporation and wholly owned subsidiary of AT&T (“Spinco”), entered into certain definitive agreements with Discovery, Inc., a Delaware corporation (“Discovery”), and Drake Subsidiary, Inc., a Delaware corporation and wholly owned subsidiary of Discovery, including an Agreement and Plan of Merger, in connection with the planned transactions involving the separation of the WarnerMedia business from AT&T followed by the combination of WarnerMedia with Discovery (the “Transactions”). Following the completion of the Transactions, holders of the shares of AT&T common stock will own approximately 71% of the outstanding capital stock of Discovery, which will be renamed Warner Bros. Discovery, Inc. (“WBD”), on a fully diluted basis (computed using the treasury method).
| Item 7.01 | Regulation FD Disclosure. |
Subsequent to AT&T’s press release on March 25, 2022, the New York Stock Exchange (“NYSE”) has advised AT&T that “when issued” sales of AT&T common stock in the ex-distribution market during the two-way trading period would be conducted under the temporary NYSE symbol “T WD,” instead of the previously announced temporary NYSE symbol “T WI.”
Accordingly, the trading options that will be available during the two-way trading period are:
| • | | AT&T Regular Way Trading – If, during the period of two-way trading, an AT&T shareholder sells a share of AT&T common stock in the regular way market under AT&T’s NYSE symbol, “T,” the shareholder will be selling both the share of AT&T common stock and the right to receive shares of WBD common stock in the Transactions. |
| • | | AT&T Ex-distribution Trading – If, during the period of two-way trading, an AT&T shareholder sells a share of AT&T common stock in the ex-distribution market under the temporary NYSE symbol “T WD,” the AT&T shareholder will be selling only a share of AT&T common stock and will retain the right to receive shares of WBD common stock in the Transactions. |
| • | | WBDWV Trading – During the two-way trading period, an AT&T shareholder also has the option of selling the right to receive shares of WBD common stock on the Nasdaq Global Select Market (“Nasdaq”) while retaining shares of AT&T common stock. This option will be available under the temporary Nasdaq symbol “WBDWV.” |
Trades under the symbols “T WD” and “WBDWV” will settle after the closing date of the Transactions. If the Transactions are not completed, all trades made under these temporary symbols will be cancelled. In all cases, investors should consult with their financial and tax advisors regarding the specific implications of selling shares of their AT&T common stock or the right to receive shares of WBD common stock on or before the closing date of the Transactions.
The information in this Item 7.01, including the exhibit attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing by AT&T under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as shall be expressly set forth by specific reference in such filing.
Statement Concerning Forward-Looking Statements
Information set forth in this communication, including any 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,
