AT&T Inc. has reached an
agreement to buy Time Warner Inc. for about $85 Million, paving the way for
what would be the biggest deal in the world this year, giving the telecom
company control of cable TV channels HBO and CNN, film studio Warner Bros and other coveted media
assets.
The deal, which has been agreed on
most terms, would be one of the largest in recent years in the sector as
telecommunications companies look to combine content and distribution to
capture customers replacing traditional pay-tv packages with more streamlined
offerings and online delivery.
AT&T, which sells wireless
phone and broadband services, has already made moves to turn itself into a
media powerhouse, buying satellite TV provider DirecTV last year for $48.5
billion. It also in 2014 entered a joint venture, Otter Media, with the Chernin
Group to invest in media businesses, and has rolled out video streaming
services.
Time Warner is a major force in
movies, TV and video games. Its assets include the HBO, CNN, TBS and TNT networks
as well as the Warner Bros film studio, producer of the “Batman” and “Harry Potter”
film franchises. The company also owns a 10% stake in video streaming site Hulu. The media industry has been seen as ripe for
consolidation, and several stocks rose on the news, including Netflix Inc.
which closed up about 3.4%, and Discovery Communications Inc, which ended up
3.6%
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