Shares dive 13% after reorganizing statement

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

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Challenges seen in offering debt-laden direct TV networks

(New throughout, adds details, background, remarks from market experts and experts, updates share rates)

By Dawn Chmielewski, Deborah Mary Sophia and Aditya Soni

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

Shares of Warner jumped 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 companies are thinking about options for fading cable businesses, a longtime money cow where profits are eroding as countless customers embrace streaming video.

Comcast last month revealed plans to divide most of its NBCUniversal cable television networks into a brand-new public business. The brand-new business would be well capitalized and placed to get other cable networks if the market consolidates, one source informed Reuters.

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

"We highly think there is capacity for relatively large synergies if WBD's linear networks were integrated with Comcast SpinCo," composed Ehrlich, using the market term for conventional tv.

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

Under the new structure for Warner Bros Discovery, the cable TV organization consisting of TNT, Animal Planet and CNN will be housed in an unit called Global Linear Networks.

Streaming platforms Max and Discovery+ will be under a different division in addition to film studios, including Warner Bros Pictures and New Line Cinema.

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

"Streaming won as a behavior," said Jonathan Miller, president of digital media investment firm Integrated Media. "Now, it's winning as a business."

Brightcove CEO Marc DeBevoise said Warner Bros Discovery's new business structure will separate growing studio and streaming properties from rewarding but diminishing cable television company, offering a clearer investment picture and likely setting the phase for a sale or spin-off of the cable system.

The media veteran and consultant predicted 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 larger target, AT&T's WarnerMedia, is positioning the business for its next chess relocation, composed MoffettNathanson analyst Robert Fishman.

"The concern is not whether more pieces will be moved or knocked off the board, or if more combination will happen-- it is a matter of who is the buyer and who is the seller," wrote Fishman.

Zaslav indicated that circumstance during Warner Bros Discovery's financier call last month. He said he prepared for President-elect Donald Trump's administration would be friendlier to deal-making, opening the door to media industry debt consolidation.

Zaslav had engaged 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 care, noting Warner Bros Discovery carries $40.4 billion in debt.

"The structure modification would make it easier for WBD to sell its direct TV networks," eMarketer analyst Ross Benes said, describing the cable business. "However, discovering a buyer will be tough. The networks are in financial obligation and have no indications of growth."

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

This week, the media business revealed a multi-year deal increasing the overall fees Comcast will pay to disperse Warner Bros Discovery's networks.

Warner Bros Discovery is wagering the Comcast agreement, together with an offer reached this year with cable television and broadband company Charter, will be a design template for future settlements with suppliers. That might help stabilize 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)