Shares dive 13% after reorganizing statement

Follows path taken by Comcast's new spin-off company

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Challenges seen in offering debt-laden linear TV networks

(New throughout, adds details, background, remarks from market insiders and experts, updates share costs)

By Dawn Chmielewski, Deborah Mary Sophia and Aditya Soni

Dec 12 (Reuters) - Warner Bros Discovery on Thursday decided to separate its decreasing cable television TV companies such as CNN from streaming and studio operations such as Max, laying the groundwork for a potential sale or spinoff of its TV company as more cable television subscribers cut the cord.

Shares of Warner leapt after the business stated the new structure would be more deal friendly and it expected to complete the split by the middle of 2025. Warner shares closed at $12.49, up more than 15%.

Media companies are considering choices for fading cable TV companies, a longtime golden goose where incomes are wearing down as millions of customers embrace streaming video.

Comcast last month unveiled strategies to divide the majority of its NBCUniversal cable networks into a brand-new public business. The new company would be well capitalized and positioned to acquire other cable networks if the market consolidates, one source told Reuters.

Bank of America research analyst Jessica Reif Ehrlich composed that Warner Bros Discovery's cable television service possessions are a "extremely sensible partner" for Comcast's new spin-off business.

"We highly believe there is potential for relatively sizable synergies if WBD's linear networks were integrated with Comcast SpinCo," wrote Ehrlich, using the industry term for standard tv.

"Further, we think WBD's standalone streaming and studio possessions would be an attractive takeover target."

Under the brand-new structure for Warner Bros Discovery, the cable TV business consisting of TNT, Animal Planet and CNN will be housed in a system called Global Linear Networks.

Streaming platforms Max and Discovery+ will be under a different division in addition to movie studios, including Warner Bros Pictures and New Line Cinema.

The restructuring shows an inflection point for the media market, as financial investments in streaming services such as Warner Bros Discovery's Max are lastly paying off.

"Streaming won as a habits," stated Jonathan Miller, president of digital media financial investment business Integrated Media. "Now, it's winning as a service."

Brightcove CEO Marc DeBevoise stated Warner Bros Discovery's brand-new corporate structure will distinguish growing studio and streaming properties from profitable however shrinking cable business, offering a clearer investment picture and likely setting the phase for a sale or spin-off of the cable system.

The media veteran and adviser anticipated Paramount and others may take a comparable path.

CEO David Zaslav, a veteran deal-maker who led Discovery through its acquisition of Scripps Networks Interactive before obtaining the even bigger target, AT&T's WarnerMedia, is positioning the company for its next chess relocation, composed MoffettNathanson analyst Robert Fishman.

"The concern is not whether more pieces will be walked around or knocked off the board, or if additional debt consolidation will happen-- it is a matter of who is the buyer and who is the seller," wrote Fishman.

Zaslav indicated that circumstance during Warner Bros Discovery's financier call last month. He stated he expected President-elect Donald Trump's administration would be friendlier to deal-making, opening the door to media industry debt consolidation.

Zaslav had participated in merger talks with Paramount late in 2015, though a deal never materialized, according to a regulatory filing last month.

Others injected a note of care, noting Warner Bros Discovery carries $40.4 billion in financial obligation.

"The structure change would make it simpler for WBD to sell its linear TV networks," eMarketer expert Ross Benes stated, describing the cable organization. "However, discovering a buyer will be challenging. The networks are in debt and have no signs of growth."

In August, Warner Bros Discovery jotted down the worth of its TV possessions by over $9 billion due to unpredictability around fees from cable and satellite distributors and sports betting rights renewals.

Today, the media business revealed a multi-year offer increasing the overall fees Comcast will pay to disperse Warner Bros Discovery's networks.

Warner Bros Discovery is sports betting the Comcast contract, together with an offer reached this year with cable television and broadband service provider Charter, will be a template for future settlements with suppliers. That might help support pricing for the domestic pay TV market. (Reporting by Deborah Sophia and Aditya Soni in Bengaluru, Dawn Chmielewski in Los Angeles; Editing by Shilpi Majumdar, Arun Koyyur, Keith Weir and David Gregorio)