AT&T and proposed merger partner Time Warner Inc have extended the termination date for their deal to 21st June 2018.
The previous terms stated that either company could terminate the deal if it the merger was not completed as of 22 April. However, there is likely to be no decision on whether the tie-up can proceed until May.
The proposed $85 million acquisition is now in limbo, thanks to the US Department of Justice (DOJ) filing a lawsuit to block it.
The DOJ is arguing that if AT&T, the nation’s largest pay-TV company, acquires Time Warner — the third largest media company worldwide and owner of HBO, Turner Broadcasting, CNN and the Warner Bros studio — it would gain too much control over programming and distribution, and potentially represent an antitrust situation. The fear is that the merged company’s size would be such that it would impede competition from online video distributors and raise content prices on its rivals on the distribution side — all of which would translate into higher prices for consumers.
“This merger would greatly harm American consumers,” said DOJ antitrust chief MakanDelrahim. “It would mean higher monthly television bills and fewer of the new, emerging innovative options that consumers are beginning to enjoy.”
The DOJ’s complaint, filed in the US District Court for the District of Columbia, seeks a permanent injunction on the merger, on the grounds that it violates the Clayton Act anti-monopoly statute.
However, the telecoms regulator, the FCC, has green lighted the situation