Shares dive 13% after restructuring 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, includes details, background, comments from industry experts and analysts, updates share rates)

By Dawn Chmielewski, Deborah Mary Sophia and Aditya Soni

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

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

Media business are thinking about options for fading cable television companies, a longtime golden goose where incomes are deteriorating as millions of customers accept streaming video.

Comcast last month unveiled strategies to split the majority of its NBCUniversal cable networks into a new public company. The new company would be well capitalized and positioned to acquire other cable networks if the market combines, one source informed Reuters.

Bank of America research expert Jessica Reif Ehrlich wrote that Warner Bros Discovery's cable television assets are a "really sensible partner" for Comcast's brand-new spin-off business.

"We strongly think there is potential for relatively substantial synergies if WBD's linear networks were combined with Comcast SpinCo," wrote Ehrlich, utilizing the industry term for standard tv.

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

Under the new structure for Warner Bros Discovery, the cable company 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 separate division in addition to film studios, consisting of Warner Bros Pictures and New Line Cinema.

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

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

Brightcove CEO Marc DeBevoise said Warner Bros Discovery's new corporate structure will separate growing studio and streaming assets from profitable however shrinking cable television TV company, offering a clearer investment photo and likely setting the stage for a sale or spin-off of the cable system.

The media veteran and consultant predicted Paramount and others may take a similar path.

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

"The question is not whether more pieces will be moved 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," composed Fishman.

Zaslav indicated that situation throughout Warner Bros Discovery's investor call last month. He said he anticipated President-elect Donald Trump's administration would be friendlier to deal-making, opening the door to media market debt consolidation.

Zaslav had actually taken part in merger talks with Paramount late in 2015, though an offer never emerged, according to a regulatory filing last month.

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

"The structure change would make it simpler for WBD to sell off its direct TV networks," eMarketer expert Ross Benes said, referring to the cable TV company. "However, discovering a buyer will be challenging. The networks are in financial obligation and have no signs of development."

In August, Warner Bros Discovery jotted down the value of its TV properties by over $9 billion due to unpredictability around costs from cable and satellite suppliers and sports betting rights renewals.

Today, the media business announced a multi-year offer increasing the total charges Comcast will pay to distribute Warner Bros Discovery's networks.

Warner Bros Discovery is wagering the Comcast arrangement, together with an offer reached this year with cable and broadband service provider Charter, will be a template for future settlements with suppliers. That might assist support prices 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)