Nexstar Nears Deal To Snap Majority Control In CW Network: WSJ

Nexstar Media Group, Inc NXST is on the verge of acquiring majority control of the CW Network from Warner Bros. Discovery, Inc WBD and Paramount Global PARA, the Wall Street Journal reports.
The leading owner of local television stations would acquire 75% of the CW, a broadcast network aimed primarily at teens and young adults, with Paramount and Warner Bros. Discovery each retaining 12.5% stakes.
Nexstar looks to assume a significant portion of the network’s current losses, which could exceed $100 million.
Also Read: Nexstar Media Tops Q1 Backed By Advertising, Distribution Revenue Growth
CBS, the broadcast network of Paramount and Warner Bros., will likely continue to create content for the CW.
Meanwhile, Nexstar looks to acquire shows from other producers as well.
Paramount and Warner Bros. Discovery will likely retain several hundred million dollars in content-licensing revenue from pre-existing deals, including a significant pact with Netflix Inc NFLX.
The CW was born from the 2006 merger of the struggling Warner Bros.’ WB and CBS’s UPN networks.
Although the CW rarely made a profit, it was very successful for its parent companies, primarily due to the Netflix licensing agreement.
In 2019, the CW’s parent companies terminated the Netflix agreement to avail the CW content for their streaming services, Paramount+ and HBO Max, and cut costs.
Paramount Global is focused on its streaming service and revamping its Paramount movie studio, while Warner Bros. Discovery, under new ownership, is looking to cut costs and prioritize businesses.
Price Actions: PARA shares traded lower by 1.12% at $24.80 in the premarket on the last check Thursday. WBD shares traded lower by 1.52% at $12.97.