AT&T stock is rallying and Time Warner is falling following remarks by AT&T’s CFO John Stephens regarding “uncertainty” about the timing of the deal between the two companies, citing ongoing DoJ discussions. AT&T stock is rallying and Time Warner is falling following remarks by AT&T’s CFO John Stephens regarding “uncertainty” about the timing of the deal between the two companies, citing ongoing DoJ discussions.
As the WSJ reports, John Stephens, AT&T’s chief financial officer, said Wednesday at a New York investor conference hosted by Wells Fargo that the timing of the transaction was “now uncertain” whereas just a few weeks ago, he told investors the company still expected the transaction to close later this year. Stephens didn’t say anything Wednesday to suggest the deal won’t be approved but pulled back from that earlier guidance.
“I can’t comment on those discussions, but with those discussions, I can now say that the timing of the closing of the deal is now uncertain,” Mr. Stephens said.
This sparked some arb unwind..
However, Stephens also noted that no vertical merger like Time Warner has been blocked in 40 years, suggesting he is optimistic that the deal will get done and confirmed 2018 priorities will be to integrate Time Warner.
AT&T agreed last year to buy Time Warner, the owner of HBO, CNN and Warner Bros. studios, in a cash-and-stock deal worth $85 billion. The Wall Street Journal last week reported the Justice Department was laying the groundwork for a possible lawsuit to stop the deal while at the same time negotiating with company executives. In the latter days of his presidential campaign, Donald Trump vowed that he would make sure the AT&T-Time Warner deal never happens.
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