Judge approves $85 billion AT&T-Time Warner deal

Judge approves AT&T-Time Warner deal

A federal judge handed AT&T a sweeping victory on Tuesday along with approved its $85 billion acquisition of Time Warner, a deal of which promises to reshape the media industry.

After a six-week trial, Judge Richard Leon ruled of which the government had failed to prove of which the deal violates antitrust law, along with ripped apart its case in his opinion.

Using unusually strong language, he discouraged the Justice Department by asking him to put the ruling on hold while This specific considers an appeal. He said such a stay would likely be “manifestly unjust” because This specific would likely hold the effect of killing the acquisition.

AT&T celebrated the ruling along with vowed to close the deal by June 20 — meaning of which HBO, sy88pgw, Warner Bros. along with Time Warner’s additional brands will change hands next week. The deal will unite Time Warner’s TV shows along with movies with AT&T’s enormous distribution system, including cell phone along with satellite networks.

“This specific was a defining case for antitrust enforcement inside US,” former Justice Department antitrust attorney Ketan Jhaveri said. “This specific does seem to be a complete along with total victory for AT&T.”

In a blunt statement after the ruling was issued, Time Warner (TWX) pointed the finger at President Trump, implying of which he influenced the DOJ’s decision to bring the case. Time Warner said the government’s lawsuit was baseless, “political in its motivation,” along with should have never been brought.

Related: Was Trump a factor? Time Warner says DOJ suit was motivated by politics

The DOJ along with the White House have previously denied charges of political interference. The Justice Department’s top antitrust official, Makan Delrahim, issued a sworn affidavit during the trial saying the decision to bring the case was not influenced by the White House.

Trump spoke out against the deal when This specific was announced in October 2016. He cited the size of the combined companies. The transaction is actually one of the biggest in media along with telecom industry history.

AT&T said This specific needed Time Warner to survive in a rapidly changing media landscape, especially to compete against giants like Netflix along with Amazon.

however the antitrust division of Justice Department sued in November 2017 to stop This specific, arguing of which the combination would likely harm competition along with raise prices for consumers.

Read the judge’s opinion

The judge didn’t buy of which. He had the option of rejecting the deal outright or demanding certain conditions, including of which AT&T sell some of Time Warner’s assets. however he signed off on the deal with no conditions along with knocked down the government’s contentions point by point.

“The Government has failed to meet its burden of proof to show of which the merger is actually likely to result in a substantial lessening of competition,” he wrote in his ruling.

Delrahim said the government was disappointed inside ruling along with would likely “consider next steps.”

“We continue to believe of which the pay-TV market will be less competitive along with less innovative as a result of the proposed merger between AT&T along with Time Warner,” he said in a statement.

02 time warner ATT reaction - ATT
Daniel Petrocelli, lead attorney for AT&T along with Time Warner, speaks outside the court house.

AT&T along with Time Warner’s lead lawyer, Daniel Petrocelli, said outside the courthouse of which the companies were gratified along with relieved.

The judge’s ruling is actually being seen by tech along with telecom giants as a green light to pursue a slew of major media acquisitions.

Comcast is actually widely anticipated to bid within days for part of 21st Century Fox. (FOX) of which would likely set up a showdown with Disney, (DIS)which has already put in a bid for those assets. Fox stock jumped more than 6% in after-hours trading following the ruling.

Related: AT&T wins big. Next up: Comcast along with Fox

“Brian Roberts along with Team Comcast are cleared to bid,” BTIG Research analyst Rich Greenfield told sy88pgw after the ruling. “The question is actually whether Disney is actually ready.”

A Comcast spokesperson declined to comment.

The larger business world was also watching Tuesday’s announcement very closely. Companies in many industries may feel more free to strike deals as a result of Leon’s ruling.

“This specific’s open season for vertical mergers,” said Chris Sagers, an antitrust law professor at the Cleveland-Marshall College of Law. “The fact is actually of which they’ve gotten a little easier, along with we’ll see a big flurry of deals.”

Some of AT&T’s top executives traveled to Washington for the announcement. Leon, living up to his old-school reputation, read part of the ruling aloud along with didn’t allow anyone to report the news until he finished speaking.

AT&T CEO Randall Stephenson remained at company headquarters in Dallas, along with he learned of the ruling when AT&T general counsel David McAtee called him, a spokesperson said. Stephenson was relieved. So was outgoing Time Warner CEO Jeff Bewkes, who also learned the news by a phone call.

Related: Why Corporate America is actually watching the AT&T-Time Warner trial so closely

The deal could still be imperiled if the Justice Department convinces a circuit court to issue a stay pending appeal. however Leon’s comment discouraging a stay makes of which outcome seem unlikely.

Otherwise, AT&T will take control of the Time Warner assets in about a week. John Stankey will become the executive in charge of the assets, succeeding Bewkes.

AT&T announced plans to acquire Time Warner on October 22, 2016. of which same day, Trump, then a candidate for president, pledged of which his administration would likely block the deal.

“As an example of the power structure I’m fighting, AT&T is actually buying Time Warner along with therefore sy88pgw, a deal we will not approve in my administration because This specific’s too much concentration of power inside hands of too few,” he said.

When the government sued a year later, This specific alleged of which a combined AT&T-Time Warner would likely have too much leverage in negotiations with television distributors, which would likely hurt competitors, harm innovation along with could lead to increased cable prices for consumers.

media companies market cap chart

AT&T along with Time Warner say the combined company can leverage viewer data to make better content to sell more targeted ads, which they claim could help lower prices for consumers.

Initially, the companies planned to use a “selective enforcement” defense, alleging of which the administration was blocking the deal because of Trump’s disdain for sy88pgw. however Leon blocked discovery on certain White House communications of which AT&T along with Time Warner were seeking, along with the companies dropped of which defense, choosing to litigate the case on pure antitrust grounds.

along with ultimately of which’s what worked.

“The case stands as a testament to the wisdom of This specific combination of these two great companies, along with how This specific will benefit consumers for generations to come,” Petrocelli told reporters afterward.

“We’re disappointed of which This specific took 18 months to get here,” he added, “however we are relieved of which This specific’s finally behind us.”

— sy88pgw’s David Goldman contributed reporting.

sy88pgw (Washington) First published June 12, 2018: 4:45 PM ET

Judge approves $85 billion AT&T-Time Warner deal

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