Time Warner Stock Jumps, AT&T Falls After Ruling Clears Path to Merger

Courts To M&A Bankers “Everbody Gets Laid!”

Courts To M&A Bankers “Everbody Gets Laid!”

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 was approved without any conditions, a stunning rebuke of the government's case. Disney has a deal to buy the bulk of Fox, but Comcast is now expected to make a counterbid, especially with the favorable ruling for AT&T.

Judge Leon has said he will issue his decision on AT&T's proposed deal today. A ruling for AT&T and Time Warner would not only give the green light for the merger, but it could unleash a flurry of other deals. Short-term effects are likely to be favorable - things like a new skinny streaming service, or perks like free HBO for AT&T wireless customers - but as Time Warner continues to negotiate rates and packages with cable companies and new streaming services, the effects will become more clear.

Because of AT&T's ownership of DirecTV, it can drive a harder bargain with other distributors that want Time Warner content, the government's lawyers argued during the trial. It may immediately trigger another deal between Comcast and Fox, which already has an agreement to sell its entertainment assets to Walt Disney.

Some thought Trump had pressed for the lawsuit because of his animus toward Time Warner's CNN.

The judge rejected the government's argument that the merger would hurt competition in pay TV and cost consumers hundreds of millions of dollars more to stream TV and movies.

Time Warner gained as much as 5.8 percent in after-hours trading, while AT&T fell as much as 3.9 percent.

Courts To M&A Bankers “Everbody Gets Laid!”

Judge Richard Leon of the U.S. District Court for the District of Columbia said at a hearing that he has found, after a six-week trial, that the deal does not violate antitrust law and can proceed.

It also appointed a new chief executive officer earlier this month, Hans Vestberg, the company's chief technology officer, in a move that signaled Verizon would likely double down on its existing telecommunications business.

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.

"We are gratified that the court's decision to categorically reject the government's bid to block this historic merger", he said.

AT&T and Time Warner said they need to combine in order to better compete with Facebook (FB), Amazon (AMZN), Apple (AAPL), Netflix (NFLX) and Google (GOOG), companies that are already powerhouses in the content game. President Donald Trump, while still a candidate, said he would block the deal "because it's too much concentration of power in the hands of too few". AT&T wasn't on board, saying, "Divestitures here would destroy the very consumer value this merger is created to unlock".

Updated 2:18 pm PT: This story was updated with comments from AT&T and the Justice Department.

Notícias recomendadas

  • Shiite cleric Sadr warns of danger on Iraq by political row

    Shiite cleric Sadr warns of danger on Iraq by political row

    The bloc of Shiite cleric Moqtada al-Sadr, which won the most seats in the election, boycotted the vote. The legislature on Wednesday also sacked the nine-member independent commission that oversaw the polls.
    Trump credits Warmbier for NK summit: 'Otto did not die in vain'

    Trump credits Warmbier for NK summit: 'Otto did not die in vain'

    In April, Warmbier's parents filed a lawsuit against North Korea, alleging that the government tortured and murdered their son. In a news conference following the summit, Trump also praised North Korea's beaches "from a real estate perspective".
    Freedom Planet Is Coming To Nintendo Switch This Autumn

    Freedom Planet Is Coming To Nintendo Switch This Autumn

    This should be helpful for discovering new Switch games or even rediscovering some old ones that are no longer on the charts. The list was initially created by a Korean ratings board, as was noted in a Restera post and reported by Eurogamer .
  • Scots hope England ODI win boosts Test bid

    Scots hope England ODI win boosts Test bid

    Scotland , batting first, scored as many as 371 runs and set the record for the highest total by an Associate Nation in ODIs. Skipper Sarfraz Ahmed scores 89 off 49 deliveries against Scotland .
    Arsenal Agree £26.5m Deal To Sign South American Star

    Arsenal Agree £26.5m Deal To Sign South American Star

    Torreira has impressed after a successful season in Serie A, leading to both Arsenal and Napoli chasing his signature. However, reports suggest Arsenal are looking to avoid paying the fee up front.
    Uber, Lyft eye two-wheeled business: Electric scooters

    Uber, Lyft eye two-wheeled business: Electric scooters

    Scooter startup Skip, Bird, Lime and Spin are among the rivals battling for a share in the scooter-sharing service market. The city wants to control the scooter sharing via a permitting process during a program of one year.
  • Tesla lays off roughly nine percent of workforce

    Tesla lays off roughly nine percent of workforce

    The majority of Tesla employees working at Home Depot will be offered the opportunity to move over to Tesla retail locations. Tesla is reportedly planning to lay off approximately 4,100 of its 46,000 employees to cut costs.
    IL officer saves 1-year-old seen running on highway

    IL officer saves 1-year-old seen running on highway

    Mannino's observation while on patrol and quick reaction, placing his squad vehicle and himself between the child and traffic. Anthony Mannino's dashcam shows the officer stopping near Route 59 and Gowdey Road, just north of Aurora Road.
    Rafael Nadal Lifts Record 11th French Open Title

    Rafael Nadal Lifts Record 11th French Open Title

    Nadal has won six of his nine matches against Thiem, all of them coming on that famously hard red clay. There have, however, appeared to be one or two chinks in Nadal's armour at Roland Garros this year.
  • Kyrie Irving’s future with Boston Celtics up in the air

    Kyrie Irving’s future with Boston Celtics up in the air

    The NBA could be set for a huge shake-up in the league come July 1 when some of the league's best players could enter free agency. He is the priciest of the three, commanding 29 percent of the Celtics salary cap this year with a figure of $31.2 million.
    Trump says he will halt Korea war games

    Trump says he will halt Korea war games

    Summitry is hard work and Trump claimed he "had not slept for 25 hours" during his time in Singapore, which lasted just under 48. It was a awful thing, it was brutal, but a lot of people started to focus on what was going on, including North Korea .

    Spain manager Lopetegui to take over at Real

    Spain are the only team in Russian Federation who have remained undefeated from Euro 2016 to the World Cup. They also play Morocco and Iran in the group stages.

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.