AT&T and Time Warner Merger Officially Approved

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by @todotvnews the 13/06/2018
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In spite of the case against presented by Trump's administration, a Federal Judge authorized on Tuesday the billion-dollar operation and imposed no conditions on the deal, which sets forth an important precedent for other major takeovers waiting to be approved. 

Following months of conflicts and a trial that lasted six weeks, a the Federal Court finally authorized on Tuesday, June 12, the merger between AT&T and Time Warner, something both companies agreed on back in 2016. The operation is valued at about US$ 85.4 billion and no conditions were imposed on the deal.

With D.C. District Court Judge Richard Leon's ruling, AT&T won the antitrust case against the Trump administration, which had filed a lawsuit to block the operation back in November of 2017.

This vertical merger, argued the Department of Justice, would damage free competition on the pay-tv arena by giving AT&T excessive power to raise programming prices for rivals, thus having an impact on the price paid by consumers to watch channels like CNN, TNT, HBO and Warner.

However, the court ruled in favor of the telco. David McAtee, AT&T's legal director, said they hope to complete the merger "on or before June 20 so we can begin to give consumers video entertainment that is more affordable, mobile, and innovative."

Thus, AT&T - owner of DirecTV and the main provider of pay-tv in the US - has become the largest telecommunications company in the United States. After the merger, the company is the proud owner of channels like HBO, CNN and Turner, and the Warner Bros. studio, which gives it new power to compete in the media market and, above all, the internet arena.

In fact, the alliance between both companies was born as an alternative to fight against technological giants like Netflix, Amazon, Apple, Google or Facebook, which have become increasingly powerful in the production of audiovisual content.

According to Reuters, the merger - which also includes the company's debt - is the fourth largest deal ever closed in the global telecommunications, media and entertainment industry. And looking at the overall picture, the deal is the twelfth largest.

This resolution sets forth an important precedent for other big mergers that are currently waiting to be approved in the US like Fox and Disney, which has also piqued the interest of Comcast.

Furthermore, the ruling came on day after the official end of net neutrality.

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