US District Judge Richard Leon approves $85 billion merger of telecom giant AT&T with media-entertainment conglomerate Time Warner, dealing a blow to the US government's efforts to block the deal.
AT&T Inc won approval from a US court on Tuesday to buy Time Warner Inc for $85 billion, dealing a blow to the US President Donald Trump's administration which tried to block the deal and likely setting off a wave of corporate mergers.
US District Judge Richard Leon said the US government had failed to meet its burden of proof that the tie-up between the largest US pay TV operator and the media entertainment giant would harm competition.
Leon told the courtroom the government's case fell short on all counts and warned against seeking to delay the deal with an appeal, saying that would cause irreparable harm to the two companies.
Nevertheless, Makan Delrahim, head of the Justice Department's Antitrust Division, said the government was considering its next steps.
"We are disappointed with the Court's decision today," he said in a statement.
"We continue to believe that the pay-TV market will be less competitive and less innovative as a result of the proposed merger between AT&T and Time Warner."
'No credible proof'
Daniel Petrocelli, chief attorney for the defendants, told reporters outside the courthouse that the decision nevertheless marked a "sound and proper" repudiation of the government's case.
After a year-long investigation, weeks of pretrial discovery and a full trial, "the government could present no credible proof in support of any of its theories," Petrocelli said.
AT&T General Counsel David McAtee said in a statement he was pleased with the outcome and the companies hoped to complete the merger by June 20.
President Donald Trump had previously denounced the merger, vowing that his administration would block it because it would concentrate corporate power unacceptably.
This aroused speculation among critics that Trump could be retaliating due to critical coverage of his administration from news broadcaster CNN, a Time-Warner property.
Fourth largest deal in global telecom
The ruling could prompt a cascade of pay TV companies buying television and movie makers, with Comcast Corp's bid for some Twenty-First Century Fox Inc assets potentially the first out of the gate.
The merger, including debt, would be the fourth largest deal ever attempted in the global telecom, media and entertainment space, according to Thomson Reuters data.
It would also be the 12th largest deal in any sector, the data showed.