AT&T agrees $86bn Time Warner deal

The deal would see Game of Thrones come under AT&T control

US telecoms giant AT&T has agreed a deal to buy HBO operator Time Warner for nearly US$86bn.

The deal will combine AT&T’s cable TV distribution platforms with Time Warner’s considerable content pipelines such as the Warner Bros studio and cablenets including TNT, TBS and Cartoon Network.

HBO shows like The Sopranos and Game of Thrones would be among those to come under the telecom giant’s control.

The deal is yet to be approved by antitrust regulators and a Senate hearing will be held in November to discuss it. AT&T is the third biggest cable TV operator in the US and also owns broadband and mobile networks, with some fearing the deal could make it dominant.

Richard Blumenthal, US Senator and member of the Senate Judiciary Committee, said such “a massive consolidation” would require “rigorous evaluation and serious scrutiny.”

“I will be looking closely at what this merger means for consumers and their pocketbooks,” he added.

Randall Stephenson, AT&T’s chairman and CEO, said conditions could be attached if required to get the deal through.

“This is a perfect match of two companies with complementary strengths that can bring a fresh approach to how the media and communications industry works for customers, content creators, distributors and advertisers,” he added.

AT&T said the deal, news of which emerged on Friday, would power “the next wave of innovation in converging media and communications industry” and would provide consumers with “unmatched choice, quality, value and experiences that will define the future of media and communications.”

The telecoms giant said it would pay US$107.50 for each Time Warner share in a combination of cash and stock worth US$85.4bn, and that it expected the deal to be completed by the end of next year.

AT&T has been looking to grow its media operation recently after buying satellite TV provider DirecTV last year for US$48.5bn.

The move is part of a growing trend for telecoms firms to get into the content business. In April, Comcast Corp acquired DreamWorks Animation (DWA) for US$3.8bn.

In the same month, US telecoms giant Verizon took a 24.5% stake in DWA’s online youth network AwesomenessTV, valuing the latter at US$650m.

In August, meanwhile, Time Warner took a minority stake in US streaming service Hulu, joining Disney, 21st Century Fox and Comcast in the joint venture.

Time Warner has snubbed buy-out attempts recently, however, rejecting an US$80bn deal from 21st Century Fox in 2014. Apple had also reportedly been in talks to buy the content giant but no offer materialised.