One of the largest telecommunications mergers of all time has just been approved.
On Tuesday, AT&T received judicial approval to move forward with its $85 billion deal to acquire media giant Time Warner, ending a contentious antitrust lawsuit leveled by the U.S. Justice Department last year.
In a ruling handed down by U.S. District Judge Richard Leon, AT&T is allowed to acquire Time Warner and take control of its substantial cache assets with no conditions applied to the sale, reports CNBC.
The acquisition would give AT&T full control over Time Warner’s cable properties. These include CNN, TBS, HBO, and film studio Warner Bothers. AT&T intends to complete the merger by June 20, one day prior to the deal’s expiry.
As of late 2017, the Department of Justice sued to block AT&T’s acquisition, citing a “major threat” to competitors. The suit argued three main points relating to leverage over industry rivals, potential harm to streaming services and possible access restrictions imposed on certain cable channels.
Justice Leon found for AT&T on all three points, stating that that Department of Justice had failed to meet the burden of proof that the acquisition would result in fewer choices for consumers and higher prices for content providers. The jurist also warned against an appeal, an option for the Justice Department after the six-week trial.
“I hope the government has the wisdom and courage” not to seek a stay, Leon said.
AT&T had initially announced its intent to buy Time Warner in 2016. The company argued that through the acquisition, it sought not only to diversify revenues, by bolster its streaming operation by bundling entertainment offerings with mobile services. The company currently provides similar incentives with its DirecTV property.
The decision is expected to spur similar merger attempts that are likely to annoy the Department of Justice. Comcast, for example, is looking to disrupt Disney’s announced deal with 21st Century Fox with a bid of its own.
As of 2017, Apple was rumored to have held preliminary talks with Time Warner over a potential tie-up, although those discussions apparently never moved forward.
Stay tuned for additional details as they become available.
Via AppleInsider and CNN