What happened

Many investors discovered their love for Warner Bros. Discovery (WBD 0.50%) on Monday. The entertainment giant's share price rose by an encouraging 3.9% on the day, following news that its latest divestment had closed. The stock's performance convincingly beat the 2.6% rise of the S&P 500 index. 

So what

Warner Bros.' counterparty in the deal, peer Nexstar Media Group (NXST -1.39%), announced that it is now the majority owner of The CW Network. All told, Nexstar holds 75% of The CW, with the remainder being owned by its sellers Warner Bros. and Paramount Global (PARA). Both of the latter companies are retaining 12.5% stakes.

The CW's initials stand for CBS, now a part of Paramount, and Warner Bros. In 2006 the two companies jointly launched the channel, which was focused on younger viewers with fresh and legacy shows such as Buffy the Vampire Slayer and Dawson's Creek.

The legacy TV network doesn't comfortably fit the current ambitions of Warner Bros. or Paramount. The former's goal is to pare its asset list down to the most successful and lucrative properties. Meanwhile, the latter aims to bolster its latecomer streaming service, Paramount+, in what has become a very hotly competitive segment of the entertainment industry.

Now what

The sale of The CW's majority stake was announced in mid-August; the financial particulars of the deal were not provided by any of its parties. The sell-off certainly makes sense given the current strategies of both Warner Bros. and Paramount, which remain in recently configured corporate forms and are pursuing new approaches to the market.