US regulator approves Time Warner’s sale of broadcast station WPCH to Meredith Corp
18 Apr 2017
The US telecom regulator yesterday approved Time Warner Inc's sale of broadcast station WPCH in Atlanta to Meredith Corp for $70 million, a move designed to gain approval for Time Warner's planned merger with AT&T Inc.
The approval will pave the way for speedy regulatory clearance of AT&T's proposed $84.5-billion acquisition of US entertainment giant Time Warner.
The US Federal Communications Commission (FCC) said that the application to transfer the license of WPCH was ''granted, without elaborating further.
FCC chairman Ajit Pai had earlier said that if AT&T's merger with Time Warner does not involve a broadcast license, then there would be no reason for his agency to step in.
With the FCC out of the way, AT&T and Time Warner will have to satisfy the US Justice Department that their merger would not significantly reduce competition.
In April 2016, US telecom giant AT&T struck a mega deal to buy multinational media and entertainment conglomerate Time Warner for $85.4 billion in cash and stock, in what could be a highly-scrutinized acquisition. (See: AT&T confirms $85.4-bn acquisition of Time Warner)
The deal came less than three months after AT&T completed its $49-billion acquisition of satellite TV provider DirecTV.
New York-based Time Warner has a great portfolio of content creation and aggregation, and iconic brands across video programming and TV / film production.
Time Warner's US and international cable networks include TNT, TBS, CNN, HBO, and Cartoon Network's Adult Swim, and has sports rights that include to National Basketball Association, NCAA Men's Championship Basketball Tournament, and Major League Baseball.
It also owns the Warner Bros film studio, producer of the ''Batman'' and ''Harry Potter'' film franchises. The company also owns a 10-per cent stake in video streaming site Hulu.
Its film franchises include Harry Potter, DC Entertainment, and LEGO, while its TV series include The Big Bang Theory, The Voice, and Gotham. The company also owns a 10-per cent stake in video streaming site Hulu.
Time Warner has been a takeover target since the past three years. In 2014, 21st Century Fox, controlled by media mogul Rupert Murdoch, withdrew its $80-billion takeover offer after Time Warner rejected the proposal saying that it was worth more (Time Warner spurns Murdoch's $80-bn offer ).
In 2015, US cable and internet provider, Comcast Corp withdrew its $45.2-billion proposed acquisition of Time Warner's cable TV service unit, after the mega deal faced opposition from consumers and a possible veto from regulators (Comcast scraps merger agreement with Time Warner Cable ).
The unit was later acquired by Charter Communications for $56 billion (Charter to acquire Time Warner Cable for $56 bn).
The AT&T-Time Warner deal will combine Time Warner's vast library of content with AT&T's pay TV subscriber base and TV, which is the world's largest, and mobile and broadband distribution.
Dallas-based AT&T is the second-largest provider of mobile telephone services and the largest provider of fixed telephone services in the US.
It also provides broadband subscription television services through its newly acquired DirecTV. It has TV customers in the US and 11 Latin American countries.
AT&T is the world's largest telecommunications company by revenue, and the world's 17th-largest mobile telecom operator.
The deal has already come under criticism from both the Republicans and the Democrats and various consumer groups since AT&T already has over 100 million subscribers across its wireless, broadband and DirecTV offerings.
Lawmakers are concerned about the limitation of consumer choice since the deal will create a company that creates its own content and provides the means to deliver both its own offerings and that of its competitors.