Home » Money

Court Approves AT&T’s Merger With Time Warner

13 June, 2018, 06:04 | Author: Shawna Walton
  • MGN Image

Before the trial started, AT&T lawyers said the Time Warner deal may have been singled out for government enforcement but Judge Leon of the U.S. District Court for the District of Columbia rejected their bid to force the disclosure of White House communications that might have shed light on the matter.

In a ruling issued Tuesday afternoon, Judge Richard Leon said that the DOJ had failed to show how the combined tv and telco giants would substantially harm competition in the United States market.

And Leon also warned the U.S. government against bringing an appeal if the objective was to try to stymie the deal. Said David McAtee, AT&T General Counsel.

The merger had also been heavily politicized due to President Donald Trump's feud with CNN, so we'll see if the Justice Department attempts to appeal.

The Justice Department had argued that AT&T's acquisition of Time Warner would allow it to charge premium prices to rivals who relied on its Turner and HBO channels to woo customers to their cable plans, potentially giving it an unfair advantage in the pay-TV market. Most analysts believe that the decision is likely to set off a wave of takeovers and consolidation in tech, telecom, and media.

A merged AT&T-Time Warner could, in principle, refuse to supply content to some distributors in order to drive consumers to purchase its own access and content bundles, but it would not be in the merged company's financial interest to do so. The Justice Department could decide to appeal the ruling, however.

Other media stocks that saw big price moves after the judge's ruling was announced included 21 Century Fox (FOX), whose shares were up almost 5 percent on speculation it could be the subject of a bidding war between Disney (DIS), which already has a $52 billion all-stock deal for Fox on the table, and a media giant like Comcast (CMCSA), which in recent weeks has been hinting of its intention to make an even larger all-cash bid for Fox.

Nonetheless, Niknam thinks AT&T's transition to more streaming services could weigh on profitability this year.

The AT&T-Time Warner merger is a direct result of media companies like Netflix and Amazon creating and distributing content through alternative means to traditional cable. If not completed by then, either company could walk away, and AT&T would have to pay a $500 million breakup fee.

The DOJ argued that buying Time Warner and its stable of popular TV programming would give AT&T too much control over programming and distribution.

But AT&T failed to provide any evidence suggesting that the DOJ's prosecution of the merger had "discriminatory effect and discriminatory intent", Leon said in a ruling earlier in the trial.

In this October 24, 2016, file photo, clouds are reflected in the glass facade of the Time Warner building in NY.

Critics charged that Trump had come out against the deal because of Time Warner's CNN, which has been highly critical of his presidency. Investors have become more confident AT&T will win, based on the difference between the offer price of $102.87 and Time Warner's share price. AT&T did not immediately respond to a request for comment.

Recommended:



Popular

Human arm found inside Florida alligator, United States News & Top Stories
They didn't live in the neighborhood, but often liked to find new places to walk their dogs and were often seen in the area. Earlier news media reports indicated the witness reported seeing the gator drag the woman into the water.

Kevin Love Wants to Finish His Career With LeBron James on Cavs
It's also good to be wanted. "We just won back-to-back". "But after a game like that, I'm not in any position to talk about that". The initial rule prevented players from signing four or five-year deals that extended into their age-36 season.

IOS 12 Could Introduce Automatic System Updates
Be warned though, this does mean you can blow through your monthly minute allowance six times as fast if you really push it... This new ability has been in plans since Apple acquired a firm called workflow which has brought this feature to iOS 12 .

Starfield is Bethesda's first new game franchise in 25 years
Dubbed the "Break-It Early Test Application", this will allow players to go hands-on when the game before it releases. These include a glow in the dark map, twenty-four Fallout figurines, in-game items, and a T-51b Power Armor helmet.

Pic! Jennifer Lawrence Looking Beyond Happy with New BF Cooke Maroney
According to their latest information, the actress is Dating 33-year-old Director of the art gallery of NY cook Maroni. Lawrence said that she "can't wait to be married" and "would absolutely not f*** it up" if she finds the right person.

Lebron James Noncommittal About Return To Cleveland
And now it will intensify following an uninspiring performance in what could very well be LeBron's last game with the Cavs. The Cavaliers' deficit ballooned from nine points at halftime to 21, 86-65, headed to the final quarter of their season.

Lyon end talks with Liverpool over Fekir transfer
The 24-year-old was being courted by Liverpool as a replacement for Philippe Coutinho, who joined Barcelona in January. Liverpool's deal with Nabil Fekir is not dead yet, according to the Mirror .

Did Beyoncé & JAY-Z Renew Their Wedding Vows?!
E! News further reports that the video also shows footage of Beyoncé and Jay-Z's family life with their kids. Bey's rep confirmed to ET Canada that these two babies are in fact Rumi and Sir .

NASA's Curiosity rover discovers organic matter on Mars
And NASA's scheduled Mars 2020 rover is slated to package soil samples for future missions to pick up and return to Earth . The samples were heated to 500C in Curiosity's oven to release any organic molecules, the kind that don't vaporise easily.

Dutch queen's sister found dead at home
She had also worked for the social development ministry in Buenos Aires province and at a United Nations office in Panama. The youngest sister of Queen Maxima of Holland has been found dead in her apartment in Argentina's capital.