AT&T completes $85B acquisition of Time Warner

article thumbnail

AppleInsider is supported by its audience and may earn commission as an Amazon Associate and affiliate partner on qualifying purchases. These affiliate partnerships do not influence our editorial content.

Two days after a federal judge found AT&T's proposed purchase of Time Warner does not violate antitrust laws, the telecom on Thursday finalized the $85 billion acquisition to create one of the largest media conglomerates in the world.

The deal affords AT&T full control over Time Warner's substantial media assets, including cable channels like CNN, TBS and HBO, and film studio Warner Bros. AT&T's gigantic merger was formally announced in a prepared statement in which chairman and CEO Randall Stephenson outlined the company's plans.

"The content and creative talent at Warner Bros., HBO and Turner are first-rate. Combine all that with AT&T's strengths in direct-to-consumer distribution, and we offer customers a differentiated, high-quality, mobile-first entertainment experience," Stephenson said. "We're going to bring a fresh approach to how the media and entertainment industry works for consumers, content creators, distributors and advertisers."

Earlier in the day, CNBC reported the Justice Department would not seek a stay of a judge's ruling that allowed the deal to move forward. U.S. District Judge Richard Leon, who presided over a DOJ antitrust case over the matter, on Tuesday found in favor of AT&T, clearing a path for the merger's completion.

Time Warner will be rolled into AT&T's media arm, which currently lacks a formal name. The newly augmented branch joins the company's communications, advertising and analytics, and international operations divisions.

Former Time Warner CEO Jeff Bewkes will remain with the company as a senior advisor during the transition period, after which his reports will answer to John Stankey, CEO of AT&T's media business.

AT&T completed the purchase with a stock issuance and $42.5 billion in cash, a move that ballooned its current outstanding debt load to $180.4 billion. With Time Warner now under its wing, however, the telecom hopes to synergize its communications and media businesses, while staving off advances from increasingly competitive streaming companies.

AT&T initially announced its intent to buy Time Warner in 2016 as it sought to diversify revenues and bolster a nascent streaming operation by bundling entertainment offerings with mobile services. The DOJ sued to block the merger in 2017 over concerns that the combined entity would pose a "major" threat to competitors.