AT&T, Time Warner merger gets approval from federal judge.
A federal judge on Tuesday approved an $85 billion merger between AT&T and Time Warner, ruling against the Trump administration, which had sought to upend the deal.
The government had argued that customers would be harmed by higher prices if telecommunications giant AT&T acquired media conglomerate Time Warner and created less competition in the market.
U.S. District Judge Richard J. Leon issued a 172-page opinion Tuesday, saying the government did not meet its burden of proof.
“In short, despite the Government’s efforts to paint a contrary picture, this is not a case containing direct, probative evidence of anticompetitive intent on the part of high-level executives within the merging company,” wrote Judge Leon, an appointee of President George W. Bush.
The decision comes after the companies have been waiting to close their deal since they first announced plans in October 2016. The Trump administration sued last year, but after months of discovery and a roughly six-week trial, AT&T will now be able to close the deal ahead of the June 21 deadline, which had a “break up fee” of $500 million.
AT&T will complete its merger with Time Warner by June 20, The Associated Press reported.
Company lawyers successfully argued that the merger would allow Time Warner to provide AT&T with innovative video and advertising opportunities, while AT&T would supply Time Warner with customer relationships.
“The parties have waged an epic battle, under extremely restricted deadlines, to litigate and try this historic vertical merger case,” Judge Leon wrote. “The Court has now spoken and the defendants have won.”
Assistant Attorney General Makan Delrahim said the government was disappointed by the ruling and is exploring next steps.
“We continue to believe that the pay-TV market will be less competitive and less innovative as a result of the proposed merger between AT&T and Time Warner,” Mr. Delrahim said.
“We will closely review the Court’s opinion and consider next steps in light of our commitment to preserving competition for the benefit of American consumers,” he added.
Judge Leon suggested he would not stay his own decision and would allow the merger to go forward, even if the government were to appeal.
“To use a stay to accomplish indirectly what could not be done directly — especially when it would cause certain irreparable harm to the defendants — simply would be unjust. I hope and trust that the Government will have the good judgment, wisdom, and courage to avoid such a manifest justice,” the judge wrote, noting that the companies were up against a deadline to complete the deal.
Some legal experts have suggested that Tuesday’s ruling could help other media giants in future deals. Telecommunications firm Comcast, for example, could make a move on the 21st Century Fox media empire if it can top Walt Disney Co.’s $52.4 billion offer, which was made in December, according to several news reports.