Variety: Warner Bros. Discovery Negotiating $500 Million Deal to Sell Film and TV Music Publishing Assets

Story from Variety:

Warner Bros. Discovery is negotiating to sell around half of the storied Warner studio’s film and TV music-publishing assets for approximately $500 million, three sources confirm to Variety. The news was first reported by Hits.

While it is unclear exactly which assets are on the table, one source says that the rights to “slightly less than half” of the catalog, with a price of around $500 million, are likely to go to a major label, with Sony said to be in the lead. The catalog is believed to include music from such films as “Purple Rain,” “Evita,” “Sweeney Todd,” “Rent” several “Batman” films and many more titles, as well as songs included in films such as “As Time Goes By” from “Casablanca” — iconic titles to be sure, but again, it is unclear exactly which rights are in play. Top attorney Allen Grubman is said to be overseeing the deal for Warner Discovery CEO David Zaslav.

However, some observers cast a skeptical eye on the deal, saying that many of the company’s assets are more than a half-century old and are “declining” in value and difficult to exploit. They are said to consist largely of film themes and cues — with comparatively few conventional songs — that would seem to have little familiarity or resonance in the present or future. The catalog is currently under a multi-year administration deal with Universal Music Publishing.

Reps for Warner Discovery, Sony and Universal either declined or did not respond to Variety‘s requests for comment.

If reports are accurate, the deal would be a welcome one for the company and its investors at a tumultuous time that includes a writers strike that has crippled Hollywood and 100 layoffs across its Discovery and Turner brands (with more expected in the coming months), not to mention Zaslav’s recent firing of his personally selected CNN CEO Chris Licht after just one year, and the network’s controversial town hall with former president Donald Trump.

The windfall from such a sale — coming at the top of a still-booming market for music catalogs — would help the company to pay down a $49.5 billion debt.

The report also comes amid a drastically changing environment for the television business as a whole. Domestic cable channels — including Discovery, TNT, TBS, TLC, HGTV, Food Network and CNN — were once the envy of the industry in terms of viewership and profitability. But the fast-changing pay TV marketplace and the rise of on-demand streaming has upended the reliable cable TV earnings power that made the former Time Warner a dynamo in the 1990s and early 2000s.