AT&T Faces Long Legal Battle if it Wants to Merge with Time Warner and Keep CNN
The Department of Justice has told AT&T that if it wants to merge with Time Warner, it must first sell either CNN or Direct TV. AT&T has fired back that it has no intention of selling CNN, and ‘experts’ suggest that a legal battle is sure to ensue, challenging DOJ’s right to prevent the merger in the first place.
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From Arts Technica
The Trump administration is asking AT&T and Time Warner Inc. to sell off either CNN or DirecTV in order to win government approval of their merger, multiple news outlets reported today.
AT&T has owned DirecTV since 2015 and is now seeking federal approval to purchase Time Warner Inc., the owner of programming such as HBO, CNN, and Warner Bros.
But a merged AT&T/Time Warner reportedly could keep CNN if it’s willing to sell DirecTV instead. CNBC said it has “confirmed the Justice Department has asked AT&T to sell Turner Broadcasting, which includes CNN, or sell DirecTV for merger approval.”
The government’s stance could lead to a legal battle. “If the Justice Department formally makes either demand a requisite for approval, AT&T and Time Warner would almost certainly take the matter to court to challenge the government’s legal basis for blocking their deal,” The New York Times wrote.
Until today, AT&T expressed confidence that it would wrap up the acquisition by the end of this year. But today, AT&T CFO John Stephens said that “the timing of the closing of the deal is now uncertain.”
AT&T said it will not sell CNN. “Until now, we’ve never commented on our discussions with the DOJ,” AT&T CEO Randall Stephenson said in a statement provided to Ars. “But given DOJ’s statement this afternoon, it’s important to set the record straight. Throughout this process, I have never offered to sell CNN and have no intention of doing so.”