Telecom firm AT&T to buy Time Warner for $85bn

Merger, if approved by regulators, to transform AT&T, which does not own content, into a media-entertainment powerhouse.

    AT&T has unveiled a mega-deal for Time Warner that would transform the telecom giant into a media-entertainment powerhouse positioned for a sector facing major technology changes.

    The stock-and-cash deal approved on Saturday is valued at $108.7bn including debt, and gives a value of $84.5bn to Time Warner, a major name in the sector that includes the Warner Bros studios in Hollywood and an array of TV assets such as HBO and CNN.

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    It would give the big US telecom firm "the world's best premium content with the networks to deliver it to every screen, however customers want it", a statement from the companies said.

    Randall Stephenson, AT&T chairman and chief executive, said: "This is a perfect match of two companies with complementary strengths who can bring a fresh approach to how the media and communications industry works for customers, content creators, distributors and advertisers."

    The tie-up, which could face tough antitrust scrutiny, makes AT&T a strong rival to Comcast, which owns Time Warner rival NBCUniversal, and aims to counter the growing threat from online services such as Netflix and Amazon.

    It also positions AT&T against longtime telecom rival Verizon, which has acquired internet group AOL and is in the process of buying Yahoo, and against new delivery platforms expected from Google and others.

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    AT&T is the second-largest US wireless carrier and third-largest cable TV provider in the US, while Time Warner controls a valuable stable of entertainment content suppliers, including Warner Bros. film and TV studios, the HBO television production group, cable news giant CNN, and the TNT and TBS cable channels.

    AT&T had $147bn in revenues in 2015 while Time Warner reported $28bn.

    AT&T has pursued an aggressive expansion, paying almost $50bn to buy satellite television provider DirecTV in 2015.

    SOURCE: Agencies


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