Visitors Now:
Total Visits:
Total Stories:
Profile image
By ETF Daily News (Reporter)
Contributor profile | More stories
Story Views

Now:
Last Hour:
Last 24 Hours:
Total:

Done Deal: AT&T Will Buy Time Warner for $85 Billion

Sunday, October 23, 2016 4:41
% of readers think this story is Fact. Add your two cents.

(Before It's News)

Time Warner logoFrom Tyler Durden: As had been leaked over the past two days, yesterday the WSJ confirmed that AT&T Inc. (NYSE:T) has agreed to buy Time Warner Inc (NYSE:TWX) in a deal worth more than $85 billion, or $107.50 per share.

The boards of the two companies are met over the weekend to approve the transaction, the WSJ said citing people familiar. The $85BN deal is half cash and half stock. The transaction brings together millions of AT&T wireless and pay-TV subscribers – recall AT&T’s most recent mega deal was its $50 billion acquisition of DirectTV – with Time Warner’s dep content and media lineup, including networks such as CNN, TNT, the cash cash that is HBO and Warner Bros. film and TV studio.

The transaction is far and away the biggest media deal of recent years. Time Warner had a market capitalization of $68 billion before The Wall Street Journal reported on the advanced talks Friday, while AT&T’s was $233 billion. AT&T has been shifting its sights to media and video in recent years, diving deeper into television after its nearly $50 billion deal to acquire satellite television provider DirecTV last year. That made AT&T, which traces its roots to the old ‘Ma Bell, the country’s biggest pay television provider as well as its second-largest wireless operator.

As the WSJ writes, “the acquisition is valued at more than $80 billion and pushes the carrier deeper into the traditional entertainment business at a time of stalled wireless growth.” The good news for Time Warner CEO Jeff Bewkes, is that by rebuffing a takeover bid from 21st Century Fox two years ago for $85 a share, he has managed to generate another 30% in upside to shareholders all thanks to an epic scramble for yield, which is what will make this deal possible.

This latest megamerger is the most ambitious marriage of content and distribution in the media and telecom industries since Comcast Corp.’s purchase of NBCUniversal and would create a behemoth to rival that cable giant. A rigorous regulatory review is expected and the acquisition of Time Warner likely wouldn’t close until late 2017, people close to the process said.

Regulators have indicated misgivings about the prior Comcast-NBCU deal—in particular, whether obligations placed on Comcast were tough enough and enforceable—so it is unclear if they will be willing to bless another such merger. At the very least, former regulatory officials say there could be significant conditions placed on the combination.

To be sure, the deal may quickly become a no deal should Trump get elected on November 8.

As he warned moments ago, “as an example of the power structure I’m fighting, AT&T is buying Time Warner and thus CNN, a deal we will not approve in my administration because it’s too much concentration of power in the hands of too few.” We are confident the merger document, when revealed, will have a Material Adverse Change clause that captures Trump’s sentiment perfectly.

This article is brought to you courtesy of ZeroHedge.

You are viewing an abbreviated republication of ETF Daily News content. You can find full ETF Daily News articles on (www.etfdailynews.com)

Report abuse

Comments

Your Comments
Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

Top Stories
Recent Stories

Register

Newsletter

Email this story
Email this story

If you really want to ban this commenter, please write down the reason:

If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.