Judge OKs AT&T merger with Time Warner

Irving Hamilton
June 13, 2018

Daenerys Targaryen, Superman and Harry Potter are all headed to AT&T after all.

The biggest impact of this deal will be felt quickly, as Comcast will now formally make an offer to Fox for the majority of its assets. Comcast has already made an offer for Sky, the United Kingdom satellite TV business.

AT&T's court victory still was never assured. And the company said it plans to close the merger, which was announced a year and a half ago, on or before June 20.

A federal judge on Tuesday ruled that AT&T and Time Warner can go through with their $85 billion merger, dealing a blow to the the Trump administration's Justice Department and ending a landmark legal battle.

The merger's approval was a stinging defeat for the Justice Department, which could move to appeal Leon's ruling.

After the ruling, Makan Delrahim, the U.S. Assistant Attorney General of the DOJ's Antitrust Division, rushed passed reporters outside the courtroom.

AT&T's wooing of Time Warner has been politically complicated from the outset. "We are going to review the opinion and take the next steps as necessary".

CVS Health, which has a pending $68 billion deal to buy Aetna, and Cigna, which has a $54 billion deal to buy Express Scripts, are likely relieved as they, too, are seeking clearance for controversial vertical mergers.

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Time Warner gained as much as 5.8 percent in after-hours trading, while AT&T fell as much as 3.9 percent. Major cable, satellite and phone companies are bulking up with purchases of entertainment conglomerates to compete against rivals born on the internet, like Amazon and Google.

The Justice Department, which may still appeal the decision, sued the companies in November, arguing that the tie-up could be used to suppress competition and raise prices for consumers. The judge found similar deficiencies in the government's other theory of harm to customers: that the deal would stunt development of streaming services and prevent competitors from gaining access to HBO.

In making its case, the US government argued that the merger of AT&T could harm consumers in a number of ways.

It is about tectonic shifts in the media and technology industries. All of this competition among network providers and content creators has been great for consumers, but it's hurting AT&T's bottom line. He said the company needed to take a giant leap into the content business.

As president, Trump has called the merger "not good for the country" and said he believed it would push pay-TV prices higher.

"We are disappointed that the court missed an opportunity to rein in the First Amendment-crushing mass media consolidation trend, which puts too much media power in the hands of too few", Manning said in a statement.

Spectators swelled Tuesday at the foot of Capitol Hill. Sessions did not comply with the request.

The ruling is a stinging defeat for the Justice Department. AT&T wasn't on board, saying, "Divestitures here would destroy the very consumer value this merger is created to unlock". AT&T did not immediately respond to a request for comment.

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