AT&T’s deal to spin off WarnerMedia and merge it with Discovery, Inc. hit its first road bump this week but the company is assuring shareholders that all it proceeding as planned.
AT&T CEO John Stankey spoke today at a UBS investor conference and said that the regulatory process so far for his company’s $43 billion merger is going as expected.
“I feel good about the process, and I think as we get into first quarter, we’ll be able to demonstrate back to the market and to many of you the natural progress that you would see occur in a complex transaction like this [and] that will provide better visibility to ultimately when that close will be,” he said.
Stankey’s air of confidence about the deal clashed somewhat with a letter sent today to the U.S. Justice Department and signed by more than 30 members of Congress. The group urged an antitrust review of the proposed merger, which it said “threatens to enhance the market power of the combined firm and substantially lessen competition in the media and entertainment industry, harming both consumers and American workers.”
RELATED: Congress members urge antitrust probe of proposed WarnerMedia-Discovery merger
Stankey today responded to the letter and said the concerns raised by lawmakers are “unfounded.” He said AT&T feels good about the data it has put forward to alleviate concerns about the merger. “It’s clearly indicated that there’s nothing unusual about this transaction.”
“I would also tell you that those letters that I’m looking at, relative to maybe some of that have occurred in past transactions, are not very strong in the foundation of their concerns, nor do I have concerns about what they’re articulating in terms of our ability to navigate through that,” Stankey said.
In the letter, the group of Congress members pointed toward President Biden’s executive order to promote competition, which warns that “excessive market concentration threatens basic economic liberties, democratic accountability, and the welfare of workers, farmers, small businesses, startups and consumers.” The group also flagged concerns over a lower rate of Hispanic workers than any other sector, the potential for the merger to reduce the amount of diverse and inclusive media and entertainment content available to consumers, and the potential for market consolidation to result in higher prices for consumers.