font-family:"Arial",sans-serif">• The teal received unconditional
antitrust clearance from the EU
font-family:"Arial",sans-serif">• IRS approved the merger’s tax-free
status in December
"Arial",sans-serif">Media company Discovery Inc’s (NASDAQ: DISCA)
plans to acquire AT&T Inc’s (NYSE:
T)
film and TV studio WarnerMedia has been approved by the U.S. Department of
Justice.
"Arial",sans-serif">In a regulatory filing released Wednesday, Discovery said
the $43 billion mega-merger deal had cleared the antitrust review in the U.S.,
which is expected to close in the second quarter.
"Arial",sans-serif">The deal now awaits approval from Discovery’s shareholders,
which is expected to get a green tight as the company previously secured
support from major shareholders John Malone and Newhouse. AT&T doesn’t need
shareholder approval for the merger.
spinoff
"Arial",sans-serif">Shares of Discovery jumped over 2.3%, and the telecom giant
AT&T nearly 1.7% on the early trading at New York.
font-family:"Arial",sans-serif">Clearing hurdles
"Arial",sans-serif">In December, more than 30 Democratic members of the U.S.
Congress sent a letter to Attorney General Merrick Garland and Justice
Department antitrust chief Jonathan Kanter, opposing the merger.
"Arial",sans-serif">“The merger threatens to enhance the market power of the
combined firm and substantially lessen competition in the media and
entertainment industry, harming both consumers and American workers,” the
letter stated.
"Arial",sans-serif">The mega-media-merger deal received unconditional antitrust
clearance from the European Commission in late December.
"Arial",sans-serif">AT&T has also received a “favorable” ruling from the
Internal Revenue Service approving the merger’s tax-free status, another
critical requirement for the deal closure.
font-family:"Arial",sans-serif">AT&T offloading debt
"Arial",sans-serif">Last year, in May, AT&T announced it would spin off
WarnerMedia to merge with Discovery to reduce the debt load it has incurred
over the years and focus only on the telecom business.
"Arial",sans-serif">The telecom giant said its shareholders would own 71% of
the new Warner Bros Discovery Co, which will be traded on Nasdaq after the
merger, under the symbol WBD.
market
"Arial",sans-serif">AT&T acquired one of Hollywood’s biggest studios, Time
Warner, in 2018 for $85.4 billion and rebranded it to WarnerMedia, to compete
with Comcast Corp (NASDAQ:
CMCSA).
"Arial",sans-serif">The new merged media and entertainment assets will bring
together TV channels like CNN, TBS, TNT, HGTV, Food Network, Discovery Channel,
the Warner Bros film studio, and streaming services HBO Max and Discovery+.
"Arial",sans-serif">Picture Credit: MediaPost