Monday, October 24, 2016
AT&T announces intentions to buy Time Warner but still needs borad and government approval
AT&T announced this weekend that it intends to acquire Time Warner for $85.4 billion. To be clear, this is not Time Warner Cable, which was sold to Charter Communications earlier this year.
AT&T said it was attracted to Time Warner because of its “vast library of content and ability to create new premium content that connects with audiences around the world.” Specifically, AT&T said it believes that the “future of video is mobile and the future of mobile is video.” This suggests that AT&T plans to make all of Time Warner’s content available to its mobile customers, which would be a similar move to its strategy following its acquisition of DirecTV.
“The new company will deliver what customers want — enhanced access to premium content on all their devices, new choices for mobile and streaming video services and a stronger competitive alternative to cable TV companies,” AT&T said.
Time Warner consists of three divisions including HBO; Warner Bros. Entertainment (Harry Potter, DC Comics, etc.); and Turner, which includes CNN, TNT, TBS, Cartoon Network, and other properties.
AT&T plans to pay $107.50 per share of Time Warner including $53.75 per share in cash and $53.75 in AT&T stock. Time Warner shareholders still need to approve the deal, as does the U.S. Department of Justice. AT&T hopes it closes by the end of next year.