AT&T braces for court battle with DOJ over Time Warner merger

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The court date for the DOJ’s challenge is March 19, about three months shy of the deadline for closing the merger. (Image: AT&T)

AT&T CEO Randall Stephenson said that AT&T’s top priority for 2018 remains closing its proposed $85 billion merger with Time Warner. The company is preparing to fight a legal challenge from the U.S. Justice Department.

“We were obviously surprised when the government decided to try to block the merger because it is a classic vertical merger between two companies that don’t even compete with one another. With 50 years of legal precedent, this is the type of business combination that the government has consistently approved with appropriate conditions. While we remain open to finding some reasonable solutions to address the government’s concerns, we do expect this case will ultimately be litigated in court…and we remain very confident that we’ll complete this merger,” said Stephenson during his company’s earnings call.

The court date for the DOJ’s challenge of the merger is set for March 19, 2018. Last year, AT&T disclosed that the merger deadline has been shifted to June 21, 2018, after both AT&T and Time Warner waived their rights to terminate the deal by the previous deadline set for April 22, 2018.

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The additional extension to the merger deadline comes after last month AT&T and Time Warner agreed to move the date from Oct. 22, 2017 to April 22, 2018, in order to give the companies more time to fend off the DOJ’s lawsuit.

RELATED: Turner CEO: AT&T-Time Warner deal can’t close soon enough

The DOJ is preparing for trial by reportedly reaching out to pay TV companies including Comcast, Charter, Cox, Verizon and Dish Network, and asking their top executives to serve as witnesses in the proceeding.

Dish Network Chairman Charlie Ergen is among some in the pay TV industry who have expressed concerns about the combination of AT&T and Time Warner. Last year, he said that the concentration of content and distribution could have a “negative impact on the consumer.”

Meanwhile, executives within Time Warner Inc. have expressed the desire for the merger to close quickly so the companies can move ahead with integration efforts.

Turner CEO John Martin during CES last month said that, at this point, everybody just wants a little clarity and that “Our view at Turner is, ‘This can’t close fast enough.’”