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Antitrust Suit Could Block AT&T's Purchase Of Time Warner

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Antitrust Suit Could Block AT&T's Purchase Of Time Warner
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AT&T Inc. (NYSE: T) is in settlement talks with the Department of Justice that may lead to conditional approval of its Time Warner Inc (NYSE: TWX) acquisition, according to Dow Jones.

But regulatory support is all but guaranteed. The DOJ is preparing an antitrust lawsuit to block the $85.4 billion deal if negotiations break down, the Wall Street Journal reported.

AT&T reiterated confidence in the merger’s eventual fulfillment, despite having been blocked in 2011 from a $39 billion deal with T-Mobile US Inc (NYSE: TMUS).

“When the DOJ reviews any transaction, it is common and expected for both sides to prepare for all possible scenarios," an AT&T spokesman said. "For over 40 years, vertical mergers like this one have always been approved because they benefit consumers without removing any competitors from the market. While we won't comment on our discussions with DOJ, we see no reason in the law or the facts why this transaction should be an exception.”

The purchase was first announced in October 2016 and was expected to close by the end of 2017.

While the parties received endorsements by the Federal Communications Commission and Chilean regulators, they have been hindered by the DOJ’s investigation. In October, they extended the deal’s termination date to accommodate a protracted regulatory timeline.

After being halted by a circuit breaker, Time Warner traded recently at $93.95, down 4.5 percent.

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Image credit: Mike Mozart, Flickr

Posted-In: Department of Justice U.S. Department of JusticeNews Legal M&A Best of Benzinga

 

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