AT&T Extends Time Warner Deal Deadline Over Federal Reviews

AT&T extended the originally set deadline for concluding its acquisition of Time Warner by "a short period of time," the company revealed in a recent filing with the United States Securities and Exchange Commission. The document dated last Friday described the decision as an attempt "to facilitate" the necessary regulatory approvals for concluding the transaction, suggesting that the delay was made on a direct request from some regulator, likely the U.S. Department of Justice which is still reviewing the deal and is the only competent agencies in the country that has yet to approve it. Recent reports suggested that the DOJ brought the probe to its final stages in mid-August and it's still unclear why the agency's efforts to review the merger proposal haven't been concluded more than two months later.

The delay itself doesn't appear to be long-term in nature as AT&T's SEC filing still notes that the second largest mobile service provider in the U.S. remains convinced that the transaction will be closed before the end of the year like it previously said. The tie-up that AT&T describes as a "vertical merger" was originally announced on October 22nd, 2016, coming in the form of a merger agreement with a deadline set to expire exactly a year later, i.e. yesterday. The telecom giant's filing didn't specify how long is the company expecting the process of acquiring remaining regulatory approvals to take and was made official by the signature from the firm's Chief Financial Officer and Senior Executive Vice President John J. Stephens.

AT&T's proposed acquisition of Time Warner is valued at $85.4 billion and previously raised some antitrust concerns among certain political actors and various entities in the U.S. who claimed that the firm shouldn't be allowed to control any companies whose content it distributes as it would otherwise be tempted to promote that content on its mobile network at a direct expense of TV shows, movies, and other creations from its rivals. The DOJ is now primarily reviewing those claims and deciding on whether they have enough merit to be used as a basis for denying the merger proposal. Time Warner is one of the largest entertainment conglomerates in the world which owns numerous established content creators and brands like CNN, HBO, Warner Bros, Cartoon Network, TNT, and TBS. If approved, the tie-up is expected to mark the beginning of a major consolidation wave in the U.S. telecommunications sector which is likely to be continued with a merger proposal from T-Mobile and Sprint.

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