A U.S. District Court judge has ruled that AT&T can move forward in its $85.4 billion purchase of Time Warner. Judge Richard Leon today ruled in favor of AT&T, allowing the deal to proceed without remedies.
AT&T announced its takeover of Time Warner in October 2016. Time Warner owns familiar media brands including HBO, Warner Bros., TBS, and CNN. Initially, the purchase was compared to Comcast’s takeover of NBCUniversal, which brought together a cable company with a major content provider. That deal was approved in 2011 after conditions were imposed on the transaction.
But AT&T ran into tougher roadblocks. In November 2017, the Department of Justice antitrust chief Makan Delrahim filed a lawsuit to block the merger of AT&T and Time Warner, citing antitrust concerns.
Today’s ruling will allow AT&T to add Time Warner’s considerable media assets to its already huge portfolio. AT&T is one of the nation’s largest internet providers. And in 2015 it purchased the satellite TV provider DirecTV.
In a statement, Delrahim said, “We are disappointed with the court’s decision today. We will closely review the court’s opinion and consider next steps in light of our commitment to preserving competition for the benefit of American consumers.”
AT&T General Counsel David McAtee said, “We look forward to closing the merger on or before June 20, so we can begin to give consumers video entertainment that is more affordable, mobile, and innovative.”
The judge warned that even if the Department of Justice appeals, he will deny a stay on the deal, so the companies can still close.
The deal could signal a green light for T-Mobile and Sprint, which announced their merger in April. Or not. AT&T argued that its purchase of Time Warner was not anti-competitive because the two companies operate different businesses, which don’t compete. T-Mobile and Sprint, conversely, do operate similar businesses that compete with each other. The two companies are positioning their merger as a necessary step for 5G. They have said they plan to invest up to $40 billion in a new 5G network.
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