US appeals against $80bn AT&T-Time Warner deal

US appeals against $80bn AT&T-Time Warner deal
In this file photo taken on October 23, 2016 People walk past an AT^T store in New York.Image copyright AFP/Getty

The US government has decided to appeal against a landmark court ruling that cleared the way for telecoms giant AT&T to buy Time Warner.

The ruling was a significant defeat for the US Justice Department, which had argued the deal would lead to less competition and higher consumer prices.

A federal judge rejected those claims last month, allowing the takeover to go through without conditions.

AT&T completed the $81bn (£60bn) deal shortly after.

David McAtee, AT&T general counsel, said the company was surprised by the Justice Department move and would defend the court’s approval.

“The court’s decision could hardly have been more thorough, fact-based, and well-reasoned,” he said.

The DoJ has not said on what grounds it would challenge the approval.

The appeal will extend a battle with competition regulators that started in 2016, when AT&T first announced its plan to buy Time Warner.

AT&T, which has a sizable mobile, broadband and satellite television business, said it wanted Time Warner’s media assets – which include TV networks HBO and CNN – to better compete with rivals such as Netflix and Amazon.

Image copyright Getty Images
Image caption Author Gillian Flynn with Amy Adams and Patricia Clarkson at the premiere of HBO’s Sharp Objects

As a candidate for president, Donald Trump said he opposed the tie-up, saying it would lead to “too much concentration of power in the hands of too few”.

Consumer advocacy groups also raised alarms.

The Department of Justice sued to block the deal in 2017, launching the biggest anti-trust suit in decades.

The case was closely followed in the US, where there is growing concern that a small number of companies dominate many sectors.

The IMF highlighted the issue of “mega-firms” in its recent review of the US economy.

Last month’s approval encouraged other companies that were considering their own acquisitions.

Comcast started a bidding war with Disney for the entertainment assets of Rupert Murdoch’s 21st Century Fox in the days following the court ruling.

AT&T shares slipped 1% in after-hours trade in New York. It recently announced price rises for its streaming television service.

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