US telecoms giant AT&T to snap up Time Warner in £70bn deal
Us telecoms giant AT&T has announced it is buying Us media group Time Warner, owner of the Warner Bros movie studio, for $85.4bn (£70bn).
The deal, which is one of the biggest this year, needs approval from regulators before it goes through.
The merger would combine a telecom giant that owns a leading mobile phone business, satellite TV and internet service with the company behind some of the world’s most popular entertainment content, including game of Thrones and the Harry Potter movie franchise.
AT&T’s chairman and chief executive Randall stephenson described the deal as ‘a perfect match’. But critics say it concentrates too much media power and the prospect of another media giant on the horizon has already drawn fire on the Us election campaign trail. speaking in Pennsylvania, Republican presidential nominee Donald Trump vowed to kill it if elected because it concentrated too much ‘power in the hands of too few’.
shares of AT&T fell amid reports of a deal in the works on Friday, ending the day down 3pc. Time Warner stock rose nearly 8pc on Friday and is now up 38pc since the start of the year.
stephenson, who will run the combined group, said: ‘This is a perfect match of two companies with complementary strengths who can bring a fresh approach to how the media and communications industry works for customers, content creators, distributors and advertisers.’
Time Warner boss Jeff Bewkes, who confirmed he will stay with the company for an undefined transition period, said more money would make it easier to produce additional programming and films.
AT&T will pay $107.50 for each Time Warner share, in a combination of cash and stock, worth $85.4bn overall, according to a statement. The firm said it expected the deal to be completed by the end of 2017.
Companies that provide phone and internet connections are investing in media to find new revenue streams. Verizon bought AoL last year and has now proposed a deal for Yahoo to build a digital-ad business.