Economy

AT&T CEO: We're under no pressure from Trump's DOJ to sell CNN

AT&T CEO: We're under no pressure from Trump's DOJ to sell CNN”

Rupert Murdoch telephoned AT&T Inc.

AT&T had expected the deal would be done by now. President Donald Trump has tangled frequently with the Time Warner-owned news network. "It's a reminder that just because Republicans are in charge doesn't mean anything goes at DOJ".

The deal has yet to be approved by USA antitrust regulators.

Reports of the negotiations came as an AT&T executive said he no longer expects the deal to close this year. That was before the new chief of the antitrust division, Makan Delrahim, was confirmed by the Senate and joined the review of the deal.

In an email provided by a DOJ spokeswoman, White House spokesman Raj Shah said that Trump "did not speak with the attorney general about this matter", and that "no White House official was authorized to speak with the Department of Justice on this matter".

AT&T's Stephenson said this week he won't sell CNN, and is girding for a potential court battle in case the government sues to block the deal.

However, according to the USA news site Wired, it's not clear whether the DoJ could successfully block the merger.

If the transaction falls apart, other bidders could emerge for Time Warner.

The two sides are still in talks on approving the deal, which was announced in October 2016, but have disagreed on whether asset sales are necessary to gain approval.

Stephenson said several times on Thursday that a combined AT&T and Time Warner will create a data and advertising company whose competitors will be the newest and most disruptive entrants into the media sector, Amazon.com Inc, Facebook Inc, Netflix Inc and Alphabet Inc's Google, not other wireless phone companies.

"But we think new bidders could be wary", said Doug Creutz, a media analyst at Cowen & Co.

AT&T bought satellite TV company DirecTV in 2015.

There is no law against a company owning two cable networks, but there is a Federal Communications Commission prohibition on owning two broadcast networks.

The Justice Department is supposed to make merger reviews based exclusively on antitrust law. Democrats including Sen. Al Franken of Minnesota and Sen.

The Justice Department said this week it's reviewing the deal on its merits.

There are concerns that AT&T would favor its programming for its millions of customers.

Being forced to sell off Turner is probably a "nonstarter" for AT&T, New Street Research analyst Jonathan Chaplin said.

Deals between TV distributors and programmers, known as vertical mergers, are considered easier to get cleared in Washington because they don't involve one rival taking out another to reduce competition - a horizontal merger. He said the company has "very good" prospects of winning in court against the Justice Department. But his comments may also give pause to media companies who look at buying rivals, as Disney sought to do in its discussions with Fox. He previously said he wouldn't be willing to sell CNN. That's raising red flags for some who worry that the White House is trying to put pressure on CNN, the news network owned by Time Warner.

"To suggest selling some of the key franchises that are some of the best for the business plan makes no sense". Get twice-daily updates on what the St. Louis business community is talking about. "There is absolutely no intention that we would ever sell CNN".

The Justice Department is pushing for 'structural remedies'.



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