AT&T acquires Time Warner in $85 billion media mega-deal

October 23, 2016 09:21

AT&T and Time Warner have agreed to an $85 billion deal -- one of the biggest media tie-ups ever.

The move, announced on Saturday evening, will help AT&T expand beyond wireless and Internet service into programming. Time Warner is the parent of CNN, TNT, HBO, the Warner Bros. studio, and other channels and websites.

AT&T (T, Tech30), which dates back to the invention of the telephone in 1876, is one of the country's largest providers of wireless phone and Internet service. It also recently acquired the DirecTV satellite TV business.

The deal will be subject to a review by government regulators that could take more than a year to complete.

AT&T will pay $107.50 a share -- a big premium over where Time Warner stock was trading last week. Including Time Warner's debt, the deal's value is $109 billion.

On a conference call with the media, Time Warner CEO Jeff Bewkes and AT&T CEO Randall Stephenson said the two companies have been in talks since August. The two met in New York for a "periodic check-in ... and the more we talked, the more the deal fell in place," Bewkes said.

"We have a very common view of the world," Stephenson added. "This thing just had what we called gravity. We started negotiating terms very quickly."

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