Brazilian Antitrust Officials Question AT&T’s Bid For Time Warner
UPDATED, 4:50 PM: Mexico’s antitrust authorities today approved the AT&T’s pending merger with Time Warner. “We appreciate the work of both COFECE and IFT to review, analyze and approve the AT&T-Time Warner merger on its merits,” said David McAtee, Senior EVP and General Counsel of AT&T Inc. “The merger of our two companies will bring together the world’s best premium content with the networks to deliver that content to every screen, however customers want it.”
PREVIOUSLY: Brazil’s antitrust authorities may present bigger challenges to AT&T’s $85 billion bid for Time Warner than U.S. ones might.
A staff report from the country’s Administrative Council for Economic Defense — known as Cade — says the corporate union might violate laws that bar pay TV distributors from also owning content, Bloomberg reports.
AT&T’s 2015 acquisition of DirecTV also gave it 93% of Sky Brasil — the country’s No. 2 pay TV provider. A union with Time Warner would give it “significant market power,” Cade said in a statement, the news service says.
Cade, an independent agency that reports to the Ministry of Justice, is due to make a final ruling by November 22.
While waiting for the issues to be resolved, the country’s telecom regulator, Anatel, barred Sky Brasil and Time Warner from sharing information.
AT&T says it’s not concerned, noting that the telco and Time Warner will “work with Cade to clarify any issues they may have to promptly reach a final resolution on the matter.”
By referring the case to the Cade board for review, the deal “has taken one more step in its path to conclusion in the Brazilian market.”
AT&T adds that the combination with Time Warner “will not bring anti-competitive impacts to the market” and, indeed, “will enlarge the options of content available for them and raise their access to information and entertainment. The operation also contributes for the market competitiveness, improving the offer of high quality services to customers, and stimulates the development of the audiovisual sector in Brazil.”
The merger has been approved by antitrust officials in 16 countries and is just waiting for Chile, Brazil and the U.S.
AT&T has said it expects the Time Warner deal to close by year end.
In May, Brazil’s National Film Agency, Ancine, opposed the merger saying that it would violate the anti-cross-ownership law, and give Sky Brasil an incentive to bar or hobble independent networks.
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