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AT&T Buys Warner Bros., HBO, Turner Corporate Parent

23 Oct, 2016 By: Erik Gruenwedel

As expected, AT&T agreed to acquire Time Warner, parent of Warner Bros., HBO, CNN, TNT and TBS, in one of the biggest media deals — valued at $109 billion, including debt.

By combining AT&T’s distribution channel, which include DirecTV, with Time Warner’s content prowess, the combined companies aim to give consumers increased choice across TV, mobile and broadband channels with ad-supported and subscription OTT and TV Everywhere models.

“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,” AT&T CEO Randall Stephenson said in a statement.

Calling it a “great day” for Time Warner shareholders, Time Warner CEO Jeff Bewkes said the deal affords the media giant increased distribution opportunities — notably wireless — to consumers.

Indeed, with a mobile network that covers more than 315 million people in the United States, the combined companies will strive to become the first domestic mobile provider to compete nationwide with cable companies in the provision of bundled mobile broadband and video.

Each of Time Warner’s three divisions is an industry leader: HBO, which consists of domestic premium pay-television and streaming services (HBO Now, HBO Go), as well as international premium and basic pay television and streaming services; Warner Bros. Entertainment, which consists of television, feature film, home video and video game production and distribution. Warner Bros. film franchises include "Harry Potter" "DC Comics," and its produced TV series include “The Big Bang Theory” and “Gotham”; Turner consists of U.S. and international basic cable networks, including TNT, TBS, CNN and Cartoon Network/Adult Swim. Also, Turner has the rights to the NBA, March Madness and MLB. Time Warner also has invested in OTT and digital media properties such as Hulu, Bleacher Report, CNN.com, and Fandango and Fandango Now.

Bewkes, who ranks among senior TW executives retaining their respective positions during the regulatory process, said the quickly consummated transaction underscores Time Warner’s ongoing economic growth.

“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,” he said.

The deal mirrors Comcast’s $49 billion acquisition of NBC Universal in 2011 — a pact that included some regulatory measures, including Comcast relinquishing direct say in Hulu affairs.

Interestingly, GOP presidential candidate Donald Trump has voiced opposition to the deal. He said he would also break up Comcast/NBC if elected president, according to CNN Money. Hillary Clinton has not commented on the deal.

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