Time Warner, CNN To Be Acquired By AT & T For $85 Billion

Advertisement

American telecommunications giant, AT&T has reached a deal to buy Time Warner, CNN for $85.4 billion.

The acquisition which reflects the company’s desire to amass reputable TV and film content to diversify its massive but mature business of providing Internet access.

In the cash-and-stock deal confirmed by AT&T and Time Warner late Saturday, AT&T will pay $107.50 per share of Time Warner.

Time Warner Corporation owns media outfits HBO, CNN, TNT, TBS, Warner Bros., theme parks, Bleacher Report and a 10% stake in streaming service Hulu.

READ ALSO:  Nigeria Secure For Business – FG Calls For Cocoa Export, Investors

The deal, approved by the boards of both companies, is expected to close before the end of 2017.

AT&T chairman and CEO, Randall Stephenson confirmed the development saying:

“This is a perfect match of two companies with complementary strengths.

“Who can bring a fresh approach to how the edia and communications industry works for customers, content creators, distributors and advertisers.

“Premium content always wins. It has been true on the big screen, the TV screen and now it’s proving true on the mobile screen.”

The deal, if approved by regulators, would be one of the largest acquisitions ever in the telecom-media sector.

att-time-warner-deal

This acquisition further confirms AT&T’s grand plan to control sizable market shares in both content and distribution businesses.

A prospect that will surely trigger concern and scrutiny among federal regulators and consumer rights advocates.

Time Warner Chairman and CEO Jeff Bewkes said in a statement:

“Joining forces with AT&T will allow us to innovate even more quickly and create more value for consumers along with all our distribution and marketing partners.”

A year ago, AT&T shocked Wall Street by paying $48.5 billion to buy satellite TV provider DirecTV.



READ ALSO:  5 Most Lucrative Online Businesses You Can Do in Nigeria

This gave it instant access to nearly all domestic markets for selling its pay-TV service and Internet-TV bundles.

Analysts suggested at the time that AT&T would look to beef up its content offerings to fully seize the benefits of the acquisition.

Offerings already made attractive by DirecTV’s NFL Sunday Ticket deal.

AT&T’s growth strategy also entails the need to evolve its main business lines — providing Internet and wireless services.

Time Warner, HBO, CNN, TNT, TBS, Warner Bros., Acquired By AT&T

With the integration of DirecTV largely completed, AT&T planned on focusing on buying more media and entertainment content companies.

Similar concerns also drove Verizon to pay $4.8 billion to buy Yahoo’s core businesses, including Yahoo Sports and Yahoo Finance.

time-warner-building

Verizon also paid $4.4 billion to buy AOL a year earlier.

AT&T also has plans to provide its own video streaming services to compete with Netflix and Amazon in the coming months.

In July 2014, 21st Century Fox, controlled by billionaire mogul Rupert Murdoch, offered to pay about $80 billion for Time Warner, or $84 a share.

READ ALSO:  Check Out Virgin Airlines New Exquisite Business Cabin

If completed, it would have been, at the time, the largest media merger since the disastrous AOL purchase of Time Warner for $162 billion in 2000.

A month later, Murdoch withdrew the offer after Time Warner Chairman and CEO Jeff Bewkes said his company was worth more and rejected it.

Time Warner once owned a cable TV service business, but spun it off in 2009 to focus on media content.

Time Warner Cable, the spun-off business, was acquired by Charter Communications last year for $56 billion.