Shares jump 13% after reorganizing statement

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

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Challenges seen in offering debt-laden linear TV networks

(New throughout, includes details, background, remarks from market experts and experts, updates share prices)

By Dawn Chmielewski, Deborah Mary Sophia and Aditya Soni

Dec 12 (Reuters) - Warner Bros Discovery on Thursday decided to separate its declining cable television organizations such as CNN from streaming and studio operations such as Max, preparing for a prospective sale or spinoff of its TV organization as more cable customers cut the cable.

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

Media business are considering choices for fading cable television companies, a longtime golden goose where incomes are eroding as millions of customers welcome streaming video.

Comcast last month unveiled strategies to divide most of its NBCUniversal cable television networks into a new public business. The new company would be well capitalized and placed to acquire other cable television networks if the industry consolidates, one source told Reuters.

Bank of America research study expert Jessica Reif Ehrlich composed that Warner Bros Discovery's cable assets are a "really rational partner" for Comcast's brand-new spin-off company.

"We highly think there is potential for relatively sizable synergies if WBD's direct networks were integrated with Comcast SpinCo," wrote Ehrlich, utilizing the industry term for traditional television.

"Further, our company believe WBD's standalone streaming and studio assets would be an attractive takeover target."

Under the brand-new structure for Warner Bros Discovery, the cable business including TNT, Animal Planet and CNN will be housed in an unit called Global Linear Networks.

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

The restructuring reflects an inflection point for the media industry, as investments in streaming services such as Warner Bros Discovery's Max are finally settling.

"Streaming won as a habits," stated Jonathan Miller, primary executive of digital media investment firm Integrated Media. "Now, it's winning as a business."

Brightcove CEO Marc DeBevoise stated Warner Bros Discovery's new business structure will differentiate growing studio and streaming possessions from lucrative but shrinking cable TV business, offering a clearer investment picture and likely setting the stage for a sale or spin-off of the cable system.

The media veteran and adviser predicted Paramount and others might take a similar path.

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

"The concern is not whether more pieces will be moved around or knocked off the board, or if additional combination will take place-- it refers who is the buyer and who is the seller," composed Fishman.

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

Zaslav had actually engaged in merger talks with Paramount late last year, though an offer never ever materialized, according to a regulatory filing last month.

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

"The structure modification would make it easier for WBD to sell off its linear TV networks," eMarketer expert Ross Benes said, referring to the cable company. "However, finding a purchaser will be difficult. The networks owe money and have no indications of growth."

In August, Warner Bros Discovery made a note of the value of its TV assets by over $9 billion due to unpredictability around charges from cable and satellite suppliers and sports betting rights renewals.

Today, the media company revealed a multi-year offer increasing the total charges Comcast will pay to disperse Warner Bros Discovery's networks.

Warner Bros Discovery is sports betting the Comcast arrangement, together with a deal reached this year with cable television and broadband supplier Charter, will be a design template for future negotiations with distributors. That could assist support rates 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)