A new media giant is born in America with the stellar acquisition of Time Warner made official a few hours ago by AT&T which will pay 107,5 dollars per share, partly in cash and partly in shares, for a value of 85,4 billion which they rise to 108,7 if debt is included. An operation, already approved by the boards of directors of the two companies, which marks a big coup in the convergence between media, communication and the Internet. First of all for its economic value, given that Time Warner has a market capitalization of $71 billion, while AT&T has a market capitalization of $231 billion. But not only for this.
The deal will combine AT&T's portfolio of wireless, broadband and satellite TV services with Time Warner's entertainment empire, which includes cable networks such as Tnt, Tbs, Cnn, the coveted premium channel HBO and Warner Bros. film and television studios. To be clear, the entire galaxy of news, TV series, cartoons, entertainment and even sports, with the exclusive for the NBA about to begin.
The new giant will go against the growing competition from streaming, with the boom of the various Netflix, Hulu, Amazon Prime, or the social networks themselves such as Facebook have further disintermediated cable or satellite TV, compressing the margins of the operators, because they guarantee access to some contents directly on their platform.
To finance the operation, AT&T has secured a 40 billion dollar credit line, of which 25 should come from JP Morgan and 15 from Bank of America. Tomorrow the word passes to Wall Street.
