24 Oct 2016

'No competitive harm' in AT&T, Time Warner merger

3:30 pm on 24 October 2016

US telecoms giant AT&T's deal to buy entertainment group Time Warner for nearly $US86 billion has drawn concern from the Democratic as well as the Republican presidential candidate.

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Time Warner owns HBO which screens hit TV series Game of Thrones. Photo: Supplied / HBO

The deal, announced just two weeks before the US election, may be the strongest sign yet that corporate America expects Democrat Hillary Clinton to be the next president.

A spokesman for Mrs Clinton, Brian Fallon, said there were "a number of questions and concerns" about the deal "but there's still a lot of information that needs to come out before any conclusions should be reached."

Democratic vice presidential candidate Tim Kaine and several US lawmakers said on Sunday that the deal may raise antitrust issues, one day after Republican presidential candidate Donald Trump also criticized the deal.

The Senate subcommittee on antitrust will hold a hearing on the acquisition before the end of the year.

Mr Kaine said lawmakers and regulators would have to review the deal and "get to the bottom" of questions over whether the merger would decrease competition.

"I'm pro-competition," Kaine said on NBC's Meet the Press.

"Less concentration, I think, is generally helpful, especially in the media."

Mr Kaine said he had not had a chance to review the details of the deal.

Mr Trump said at a rally on Saturday (US time) that he would block it if he won the election early next month.

"It's too much concentration of power in the hands of too few," Mr Trump said, who has has accused the media of being biased against him and his campaign.

However, the US Justice Department, not the president, has the power to reject such a deal if it violates antitrust laws.

AT&T said it was unclear if the Federal Communications Commission would also have jurisdiction to review the deal.

A spokesman for the Justice Department declined to comment and an AT&T spokesman also declined to comment on lawmaker criticism.

Deal will give AT&T control of HBO, CNN

The biggest deal in the world this year will, if approved by regulators, give AT&T control of cable TV channels HBO and CNN, film studio Warner Bros and other coveted media assets.

And it raises concerns that AT&T might try to limit distribution of Time Warner material.

AT&T chief executive Randall Stephenson said he believed regulators would approve the deal.

Mr Stephenson said there was "no competitive harm that is being rendered by putting these two companies together, so any concerns by the regulators, we believe, will be adequately addressed by conditions."

Competitors to AT&T and Time Warner such as NBCUniversal, Twenty-First Century Fox and the Walt Disney could find that their content put at a disadvantage, some consumer advocacy groups said.

AT&T will pay $107.50 per Time Warner share - half in cash and half in stock - worth $US85.4 billion overall, according to a company statement.

AT&T said it expected to close the deal by the end of 2017.

- BBC / Reuters

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