Transactions

AT&T's Stephenson Says He Didn't Pitch TW Deal To President

Deal will definitely not be submitted to FCC 2/10/2017 9:50 AM Eastern

AT&T Chairman Randall Stephenson said Friday (Feb. 10), that the Time Warner deal will definitely not be filed with the FCC and said suggestions he had pitched the deal personally to Donald Trump were flat out wrong.

Appearing on CNBC's Squawk Box Friday (Feb. 10), he said "the latest" on the proposed $85 billion Time Warner merger was that the deal had been filed with the Department of Justice and the review was ongoing. He confirmed what AT&T had signaled in an SEC filing--there will be no filing at the FCC because no licenses are changing hands. 

"It will be a one-track review," he said, adding that it was proceeding as expected at Justice and he still thought it would be closed by the end of the year. Justice reviews deals for antitrust issues, the FCC's is a wider review that includes the impact on the public interest. But Justice usually reaches out to the FCC for input during its review, given that the FCC is the expert agency on communications.

Stephenson also talked about the company's spectrum holdings. He said AT&T had been amassing a lot of spectrum licenses In the past eight years and that, in the spectrum "arms race," it has a large and fallow block of spectrum real estate and will start lighting up 500 meg wireless service in Austin, Tex., and Indianapolis this year.

President Donald Trump had threatened to block the merger while on the campaign trail, but MSNBC pointed out that new Attorney General Jeff Sessions has said there would be no politics involved in the review.

Stephenson said that was good news since the deal should be reviewed on the legal merits, which he emphasized was a vertical merger.

Stephenson said reports he had personally pitched the deal to Trump were wrong. "I have had two conversations with President Trump (http://www.multichannel.com/news/finance/att-s-stephenson-trump-focused/410429) or his administration and in neither one of those conversations was there any discussion about this deal. We have to be very, very cautious."

He also said there was not truth to a suggestion that CNN "would take care" of the Trump Administration.

Trump has been highly critical of CNN, calling it fake news after it reported on a security briefing Trump got on claims of Russian election interference and the President's personal conduct.

Stephenson said that as "big and juicy" as the story seems, it is "a pretty straightforward transaction.

"It is a telecom company buying a media and entertainment company. We compete nowhere. The day after we close this the telecom industry is going to look exactly as it does today. The media and entertainment industry is going to look exactly as it does today, so it is a clean transaction and we feel good about it."

Stephenson praised FCC Chairman Ajit Pai's scrapping of the Wireless Bureau's zero rating advisory against AT&T's DirecTV Now, saying it was among a half dozen things that would have been bad for the industry that had gone away under new FCC management.

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