AT&T acquisition of Time Warner cleared by judge

Lawrence Kim
June 14, 2018

A judge has just ruled that AT&T can acquire Time Warner.

Bloomberg: The AT&T Ruling Could Change How Mega Deals Are Made - "For years, these so-called vertical deals have typically received light treatment from antitrust enforcers, unlike the horizontal mergers that bring together direct competitors". For more, RT America's Manila Chan is joined by former Florida Democratic Party Chair Mitch Ceasar and GOP Strategist Ken Del Vecchio.

Petrocelli told Judge Leon that their estimates show FAANG is worth $3 trillion collectively, while an AT&T-Time Warner entity post-merger would be worth $300 billion.

Comcast is expected to offer $60 billion for the Fox regional sports networks, the FX cable channel, the Sky satellite-TV business in Europe, Fox movie and television studios, and Fox global channels as early as Wednesday. A loss for AT&T and Time Warner could have signaled a new era of government scrutiny over so-called "vertical mergers" and could have halted attempts by companies like Disney, Fox and Comcast to announce their own megadeals. The DOJ filed suit in November, claiming that the Time Warner deal would eventually result in higher TV prices for millions of consumers.

DOJ antitrust official Makan Delrahim said the government is disappointed in the court's decision and will consider "next steps".

Government lawyers had argued that the takeover would hurt innovation and allow AT&T to charge rival providers more for its must-have content - costs that would ultimately be passed on to consumers.

Disney CEO Bob Iger has previously addressed the reports of Comcast's plans to out-bid Disney, stating he was "confident" in the latter's offer and the studio would remain optimistic about its ability to close a deal that shareholders were said to view favorably.

The US stance on AT&T's purchase of Time Warner has formed a big piece of the M&A puzzle when it comes to competition.

Judge Leon's decision is sure to open the doors to more mergers involving media companies as content continues to drive the ISP and the wireless industries.

"Compare today to the 50s or 60s when we had three television stations and you had one AT&T that was, then, protected by government monopoly", Crews said.

Executives at both companies broach the idea that the merger was singled out for antitrust enforcement because of President Donald Trump's animosity toward Time Warner unit CNN.

"We want people engaged with their mobile devices all day watching movies and video", Stephenson said in April during the trial.

His 172-page decision delivered a stinging defeat to Trump administration's Justice Department while opening the door for Comcast Corp.to bid for parts of 21st Century Fox and become an global company.

"We are pleased that, after conducting a full and fair trial on the merits, the Court has categorically rejected the government's lawsuit to block our merger with Time Warner", the AT&T victory lap reads.

The White House did not immediately respond to a request for comment.

Other reports by Click Lancashire

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