Economy

AT&T Cleared by Judge to Buy Time Warner, Create Media Giant

AT&T Cleared by Judge to Buy Time Warner, Create Media Giant

The oral opinion, slated to be delivered after 4 p.m. E.T.by U.S. District Judge Richard Leon, will cap the company's almost two-year battle to close its takeover of Time Warner Inc.

"The impact from this decision will have wide reaching ramifications across the telecommunications, media, and tech industry for decades to come", said GBH Insights analyst Dan Ives.

A federal judge has approved AT&T's merger with Time Warner. The Justice Department could decide to appeal the ruling, however.

Rival cable company Comcast is now likely to go ahead with its planned attempt to woo Twenty-First Century Fox Inc away from Walt Disney Co, which said it would acquire most assets of the media company for around $50 billion past year.

Leon said the evidence and testimony provided by the government were faulty and that it never proved the merged entity would have increased leverage over its competitors.

The Justice Department has not brought a suit seeking to stop a vertical merger - whereby companies operating in different spaces combine - since 1979.

Prior to the news on the decision in the case, AT&T stock closed up 0.5% (to $34.50 per share) and Time Warner closed up 0.05% in regular trading (to $96.22 per share) which concluded at 4 p.m. ET. Announced in October 2016, it was seized on by then presidential candidate Donald Trump as the sort pf deal his administration would block. Disney has bid for 21st Century Fox's entertainment assets, a deal that appears to have been shaped to avoid a challenge by Delrahim's antitrust squad.

AT&T completes acquisition of Time Warner

The ruling is a stinging defeat for the Justice Department.

As one carrot to get deal approval, AT&T CEO Randall Stephenson mentioned in court that AT&T will be debuting a new skinny streaming service in the near future. The ruling comes one day after the repeal of net neutrality, meaning that AT&T now has more freedom to prioritize the delivery of select content on its network. He said AT&T plans to close the deal on or before June 20.

On the campaign trail Trump argued that a combined AT&T/Time Warner was "too much concentration of power in the hands of too few".

"The judge's sweeping rejection of the government's case doesn't surprise us at all", AT&T attorney Daniel Petrocelli told reporters outside of the courthouse shortly after the decision was issued. The government's star witness was Carl Shapiro, an economist at the University of California, who used an economic model to predict that consumer cable bills could rise by $500 million annually in aggregate by 2021.

"Judge OKs AT&T merger with Time Warner, rejecting government argument it would hurt pay-TV consumers, competition".

AT&T has said it needs to buy Time Warner to compete with the likes of Amazon, Netflix and Google in the shape-shifting streaming-TV environment.

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.

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