AT&T’s ambition to become a telecom-media giant faces a decisive moment on Tuesday with an expected ruling on whether its $85.4 billion takeover of Time Warner can proceed. The decision will be no less momentous for President Trump’s Justice Department, because a victory for the government could rewrite the way antitrust rules and takeovers are applied. Here’s a primer on what is about to happen: If the deal is approved: AT&T will move quickly to complete its $85 billion deal for Time Warner. AT&T says it intends to close less than a week after a deal is approved, allowing for a short process by the appeals court to order a stay. If the deal gets blocked: AT&T will effectively be barred from buying a large content company. It may try to buy …show more content…
That power would allow the company to raise prices for pay TV rivals and online streaming services, the government said. In the past few months, a new level of worry has cropped up as whispers have increased that Time Warner may seek to renegotiate the terms of the deal, even if Leon’s verdict goes in favor of AT&T. So much time has passed since the initial deal was struck that Time Warner’s board may have an obligation to push AT&T to raise its offer, in light of the hot M&A market for blue-chip media and content brands. What’s more, Time Warner has delivered strong earnings during the past few quarters, underscoring the value of the company’s core assets: Warner Bros., HBO and Turner. In this climate, Time Warner’s board members could face shareholder backlash if they doesn’t consider what the market will bear for the company in 2018 compared to 2016. This process could also encourage rival bidders to make a run at Time Warner. All of which will drag out the waiting period for Time Warner’s nearly 24,000