" /> AT&T and Time Warner have extended their $85.4 billion merger agreement once again as the companies prepare for the legal battle against the Justice Department’s efforts to block the union. - bambinoides.com | bambinoides.com

AT&T and Time Warner have extended their $85.4 billion merger agreement once again as the companies prepare for the legal battle against the Justice Department’s efforts to block the union.

AT&T, Time Warner Extend Merger Agreement Deadline as Trial Looms

 

AT&T and Time Warner have extended their $85.4 billion merger agreement once again as the companies prepare for the legal battle against the Justice Department’s efforts to block the union.

In a Securities and Exchange Commission filing Friday, AT&T said the companies agreed to extend the deadline for completing the deal to June 21. The two had previously extended the agreement, originally set in October 2016, through April 22 in light of the prolonged regulatory review.

In November the Justice Department filed suit in federal court to block the merger on anti-trust grounds. The trial is set to begin March 19 in Washington, D.C.

The AT&T-Time Warner agreement called for AT&T to pay Time Warner a breakup fee of $500 million if AT&T was unable to close the deal. That’s a low fee, relative to the size of the transaction, and an indication of AT&T’s confidence that the merger would pass muster with regulators because the two companies have virtually no overlapping operations.

The Justice Department’s lawsuit comes amid a fraught period in Washington, with President Donald Trump regularly bashing Time Warner’s CNN for what he describes as spreading “fake news.” Trump’s animosity to CNN is seen as driving the Justice Department’s demand that AT&T sell either Turner, the division that houses CNN, or satcaster DirecTV as a condition of approval.

The Justice Department maintains the combination of AT&T’s wireless business, DirecTV and Time Warner’s content operations would give the combined company too much power to raise prices for pay TV service, among other concerns.

On Thursday, the D.C. District Court judge presiding over the case warned both sides to keep the sparring inside his courtroom, and not in the media.

“Let’s encourage those in the hardworking communications departments to chill out,” Judge Richard Leon said during a pre-trial hearing.

The fate of AT&T-Time Warner is being closely watched by the industry at a time when more M&A activity is expected among media players. Already, Disney has set a $52.4 billion bid to buy the bulk of 21st Century Fox — a deal that is also expected to face at least a year’s worth of regulatory scrutiny.

 


Variety | (CREDIT: SIPA VIA AP IMAGES | Pictured: AT&T chairman-CEO Randall Stephenson, Time Warner chairman-CEO Jeff Bewkes)


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