Odds of AT&T/TW Regulatory OK About Even, Analyst Writes Investors

Moffett, said the approval faces a 50-50 probability, "many of them felt it is nearly impossible to assign any odds at this stage," he wrote Monday of his contacts. "At the time of this writing, Time Warner shares trade at a yawning 24% discount to AT&T’s offer price of $107.50." Odds would be lower than even for approval if the FCC reviews the deal, higher if the commission doesn't, Moffett emailed us Tuesday of the consensus of his interviews. A reason "this transaction is so hard to forecast is that we don’t even know at this point who will conduct the review," Moffett noted of whether the FCC will review the deal or just DOJ. "On one point, there was clear consensus. This process will take a long time. The consensus was to look for an early 2018 decision, with the full process likely taking eighteen months. The key issue is the relatively cumbersome process of personnel changeovers that are coming at the FCC and DOJ" with the presidential elections. The telco looks "forward to discussing the many benefits of this transaction with regulators and legislators," said a past statement (see 1610260070) from General Counsel David McAtee that a company spokesman pointed us to Tuesday. "In the modern history of the media and the Internet, the U.S. government has always approved vertical mergers like ours, because they benefit consumers, strengthen competition, and, in our case, encourage innovation and investment.” Zero rating and programming access likely will be a key focus of government review of the combination, experts have told us (see 1611020034).