The US Department of Justice will not appeal the merger between AT & T and Time Warner after the loss of the court


WASHINGTON (Reuters) – AT & T Inc. emerged as the winner on Tuesday of the Trump government's efforts to block the $ 85.4 billion purchase of Time Warner. The US Department of Justice said it would not oppose a decision of the court of appeal approving the agreement.

The acquisition was closely monitored by politicians after being criticized by US President Donald Trump, who opposed it because he was present at CNN's Time Warner unit, accused of broadcasting " false information".

The formation of three judges at the US Court of Appeals of the Federal District of Columbia unanimously ruled in favor of the agreement on Tuesday, saying that the government's argument that the merger would result in an increase consumer prices was "unconvincing". Ministry of Justice's one-month effort to block the deal.

This was AT & T's second major victory against the Department of Justice, paving the way for the integration of the second wireless carrier into its WarnerMedia business and its new Xandr advertising unit.

"We are grateful to the Court of Appeal for taking into account our objections to the opinion of the District Court. The ministry does not intend to request a re-examination, "Justice Ministry spokesman Jeremy Edwards said in a statement.

Makan Delrahim, head of the Antitrust Division of the Justice Department, telephoned AT & T General Counsel David McAtee and former Time Warner Advocate General Paul Cappuccio. to congratulate them on the court's victory, according to a source close to the events.

McAtee said the merger "has already brought significant benefits to consumers and will continue to do so for years to come."

The deal was seen as a turning point for a media industry that was thwarted by companies such as Netflix Inc. and Google Alphabet Inc., which put content online without the need for a cable subscription.

The merger, announced in October 2016, was closed on June 14, 2018, shortly after US District Judge Richard Leon declared it legal, in accordance with antitrust law.

AT & T has agreed to operate the Turner Network separately until February 28 or until the conclusion of any appeal by the Department of Justice. AT & T also agreed that it would not play any role in setting Turner's pricing to distributors and that the number of Turner employees would remain largely unchanged.

The court of appeal attacked Leon, who was scathing in his assessment of the government's attempt to end the deal.

"The district court has undoubtedly made problematic statements, which the government identifies and this court can not ignore," the court said in its opinion.

FILE PHOTO: An AT & T logo is presented in Pasadena, California, United States, January 24, 2018. REUTERS / Mario Anzuoni / File Photo

Gigi Sohn, who worked for the Federal Communications Commission under the Obama administration, said the decision showed that it was necessary to reform the antitrust laws so that the government could end the problematic agreements.

"AT & T favors Time Warner and DirecTV content over its broadband services through its DirecTV Now and Watch services," she said. "Consumers are the losers."

AT & T shares closed up 0.3% to $ 31.22 on Tuesday.

Reportage of Diane Bartz and David Shepardson; additional reports by Sheila Dang and Helen Coster; edited by Chizu Nomiyama, Meredith Mazzilli and Leslie Adler

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