Shares jump 13% after reorganizing statement

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

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Challenges seen in offering debt-laden linear TV networks

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

By Dawn Chmielewski, Deborah Mary Sophia and Aditya Soni

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

Shares of Warner jumped after the company said the new structure would be more deal friendly and it anticipated to complete the split by the middle of 2025. Warner shares closed at $12.49, up more than 15%.

Media business are considering options for fading cable companies, a long time golden goose where earnings are eroding as millions of customers embrace streaming video.

Comcast last month revealed strategies to divide the majority of its NBCUniversal cable television networks into a brand-new public business. The new company would be well capitalized and positioned to acquire other cable networks if the market consolidates, one source told Reuters.

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

"We strongly believe there is capacity for relatively sizable synergies if WBD's direct networks were integrated with Comcast SpinCo," wrote Ehrlich, utilizing the market term for traditional television.

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

Under the new structure for Warner Bros Discovery, the cable television organization 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 different division along with movie studios, including 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 paying off.

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

Brightcove CEO Marc DeBevoise stated Warner Bros Discovery's brand-new corporate structure will separate growing studio and streaming assets from lucrative however diminishing cable television TV organization, offering a clearer financial investment photo and likely setting the stage for a sale or spin-off of the cable unit.

The media veteran and consultant anticipated Paramount and others might take a comparable course.

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

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

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

Zaslav had participated in merger talks with Paramount late in 2015, though an offer never materialized, according to a regulative filing last month.

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

"The structure modification would make it simpler for WBD to sell its linear TV networks," eMarketer analyst Ross Benes stated, describing the cable television organization. "However, finding a buyer will be difficult. The networks are in debt and have no signs of growth."

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

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

Warner Bros Discovery is wagering the Comcast agreement, together with a deal reached this year with cable and broadband service provider Charter, will be a design template for future settlements with suppliers. 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)