The Justice Department on Thursday filed notice that it is appealing a judge's approval of AT&T's purchase of Time Warner. AT&T said it was surprised by the decision and would defend the merger in court again.
The appeal won't change anything at AT&T while the district court's ruling remains in effect, but comes as an unwelcome distraction for the company, where executives were eager to plunge into the high-profile world of show business.
Among 19 analysts covering AT&T Inc (NYSE:T), 6 have Buy rating, 2 Sell and 11 Hold.
"I think the Department of Justice believes this is a really important case that will influence the legal standard for analyzing vertical mergers in the 21st century", she said. When the deal was announced nearly three weeks before the 2016 election, then Republican nominee Donald Trump rejected the transaction by stating, "It's too much concentration of power in the hands of too few".More news: Twitter CEO Jack Dorsey lost 200,000 followers in account purge
AT&T said in a statement Thursday that judge Richard Leon of the U.S. District Court for the District of Columbia correctly decided the case.
"The AT&T-Time Warner transaction is a bad deal for consumers and competition", he said. Prosecutors argued that AT&T could inflate the price of HBO for other content distributors.
Consumers should be heartened by the DOJ's move, says John Bergmayer, senior counsel at consumer advocacy group Public Knowledge, who described the merger as "a bad deal for consumers and competition".
The deal also seemed to set the stage for even more consolidation between telecom and media companies, leading Comcast to challenge Disney for ownership of Fox's film and TV assets.