AT&T has reached an agreement to buy Time Warner for $85.4bn (£69.8bn), the telecoms giant has announced.

AT&T is the second-largest mobile network operator in the US and the third-largest cable TV provider, while Time Warner controls a valuable stable of entertainment content suppliers

The deal will, if approved by regulators, give AT&T control of cable TV channels HBO and CNN, film studio Warner Bros, the TNT and TBS cable channels, and other coveted media assets.

It will have control of a massive catalogue of popular content from sports to films, such as Suicide Squad and Fantastic Beasts, and TV series including Game Of Thrones, The Wire, Sex And The City and The Sopranos.

AT&T will pay $107.50 per Time Warner share, in a combination of cash and stock, worth $85.4bn overall, according to a statement.

The company said it expected to close the deal by the end of 2017.

The move comes in the face of challenges facing media companies from the decline of conventional cable TV as consumers increasingly turn to streaming on mobile technology.

The tie-up of the two media giants, together worth over $300bn in market value, is certain to face tough scrutiny from anti-trust regulators because of potential ripple effects across media platforms.

US Senator Richard Blumenthal, a member of the Senate Judiciary Committee, said: "Such a massive consolidation in this industry requires rigorous evaluation and serious scrutiny.

"I will be looking closely at what this merger means for consumers and their pocketbooks."

Republican presidential candidate Donald Trump has also said he would block any merger between AT&T and the media conglomerate if he wins the election on 8 November.

He has complained about media coverage of his campaign, particularly by Time Warner's CNN.

"It's too much concentration of power in the hands of too few," said Mr Trump.

However, AT&T chief executive Officer Randall Stephenson called the deal "vertical" rather than "horizontal" and played down regulatory obstacles.

He said: "There's no competitor being removed from the marketplace, there's no competitive harm that is being rendered by putting these two companies together.

"So any concerns by the regulators, we believe, will be adequately addressed by conditions, that's our anticipation."

Analysts believe the deal could prompt other major mergers involving large media companies.

The Wall Street Journal reported on Friday that Apple had approached Time Warner about a possible tie-up a few months ago, but talks failed to make progress.

The merger with Time Warner would be one of the biggest marriages between a pay-channel company and a content provider since the Comcast's takeover of NBCUniversal in 2011.

Time Warner rejected an offer of more than $75bn two years ago from 21st Century Fox, saying the price was too low.

It has had a previous troubled merger with US internet group AOL in 2000, which ended in a split in 2009.

The five biggest mergers in history:

:: $180bn - Vodafone (UK) and Mannesmann AG (Germany) - 1999

:: $165bn - Time Warner (US) and America Online (US) - 2000

:: $128bn - Verizon Communications (US) and Verizon Wireless Inc (US) - 2013

:: $98bn - RFS Holdings BV (Netherlands) and ABN-AMRO Holding NV (Netherlands)

:: $90bn - AB InBev (Belgium) and SABMiller (UK) - 2015



Source: Sky News.

Post a Comment

Previous Post Next Post