Warner Bros. Discovery and BT Sport Close Joint Venture Deal

A new European sports giant has formed.

On Thursday, Warner Bros. Discovery and BT Sport closed a deal to create a sports media joint venture in the U.K. and Ireland. The 50-50 venture will combine the two companies’ sports rights to create a major new offering for both countries.

The venture combines BT Sport with Eurosport U.K., which will retain their separate brands for now, but have plans to combine under one name. They collectively hold rights to:

• English Premier League
• UEFA Champions League
• Olympics
• Grand Slam tennis tournaments
• Tour de France and other cycling events

Under the deal, BT Group will receive $107.3 million over the next three years, plus up to $623 million based on the joint venture’s performance. Warner Bros. Discovery will then have the option to buy out BT.

Cuts Coming

Warner Bros. Discovery, which formed in April following a $43 billion merger in which AT&T spun off WarnerMedia, is looking to trim $3 billion in expenses under CEO David Zaslav.

The media giant has had a rocky start, losing around 46% of its value since the merger closed. It currently has a market capitalization of $32 billion.

The company reported $9.8 billion in revenue and a $3.4 billion loss in the second quarter, its first fiscal period as a combined entity.