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AT&T and Time Warner Close $85 Billion Merger

Deal gives AT&T control of Warner Bros., HBO and Turner

AT&T and Time Warner have closed their $85.4 billion merger, just two days after receiving regulatory approval from a judge, the telecom company announced on Thursday.

“The content and creative talent at Warner Bros., HBO and Turner are first-rate. Combine all that with AT&T’s strengths in direct-to-consumer distribution, and we offer customers a differentiated, high-quality, mobile-first entertainment experience,” said AT&T CEO Randall Stephenson in a statement. “We’re going to bring a fresh approach to how the media and entertainment industry works for consumers, content creators, distributors and advertisers.”

The U.S. Department of Justice, which argued to block the deal, said in a joint filing with AT&T earlier on Thursday that the government would not file to try to prevent the two companies from closing the deal.

A DoJ official said the department, “continues to evaluate its options with respect to appeal.” The government has 60 days to appeal the decision, though U.S. District Judge Richard Leon told the DoJ in his decision that he didn’t believe they would be successful if they appealed.

In announcing that the company has closed its deal with Time Warner, AT&T laid out the new structure for the company and who will oversee each division.

Jeff Bewkes, who was Time Warner’s chairman and CEO, will stay on during a transition period as a senior advisor.

“Jeff is an outstanding leader and one of the most accomplished CEOs around. He and his team have built a global leader in media and entertainment. And I greatly appreciate his continued counsel,” Stephenson said.

AT&T is now broken up into four business groups: AT&T Communications, AT&T International, AT&T media business and AT&T advertising and analytics business — the latter two will be renamed at a later date.

John Stankey, who oversaw AT&T’s entertainment division before the merger, will be the CEO of the AT&T media division, which includes HBO, Turner and the Warner Bros. studio. Combined, the businesses generated more than $31 billion in revenue last year.

All of Bewkes’ direct lieutenants, such as Warner Bros. head Kevin Tsujihara and HBO chief Richard Plepler, will now report to Stankey.

John Donovan will continue to oversee AT&T Communications, which encompasses the mobile, broadband, video and other communication services. Lori Lee will lead the international business and Brian Lesser is CEO of AT&T’s ad and analytics business.