U.S. telecommunications firm AT&T and Discovery on Monday announced their intention to combine their content assets to "create a premier, standalone global entertainment company."

According to the companies, the deal will "combine WarnerMedia's premium entertainment, sports and news assets with Discovery's leading nonfiction and international entertainment and sports businesses."

When the deal is finished, the new company, whose name will be disclosed by next week, will be 71 percent owned by AT&T shareholders and 29 percent by Discovery investors.

AT&T bought Time Warner in 2018 for $80 billion, then renamed it WarnerMedia, which owns HBO, Warner Bros. studios and cable channels such as CNN. And Discovery has channels in 220 countries and regions, according to its website. 

After the announcement of the merger, shares in Discovery surged nearly 16 percent to $41.3 in premarket trade and AT&T stock increased by about 4 percent to $33.67.

(With input from AFP)