AT&T and Time Warner executives have met in recent weeks to talk about ways to collaborate, including a potential merger, according to a Thursday Bloomberg report.
The report characterizes the talks as informal at this stage, primarily focused on “building relations between the companies” rather than sketching out a potential deal, but the idea of a merger is on the table. Time Warner CEO Jeff Bewkes was described as a “willing seller,” according a person familiar with the talks who spoke with Bloomberg.
Another person close to the discussions told Bloomberg that AT&T CEO Randall Stephenson is looking to add more content and original programming. AT&T became the country’s largest pay-TV provider when it acquired DirecTV last year. DirecTV is expected to launch its over-the-top streaming service, DirecTV Now, by the end of the year.
DirecTV Now would join competitors such as Dish Network’s Sling TV and forthcoming live-TV streaming services from the likes of Hulu and Google, although DirecTV Now plans a more robust package than the “skinny bundle” offered by SlingTV, with more than 100 channels.
Earlier this month, Bloomberg reported that AT&T will look to acquire media and entertainment companies valued between $2 billion and $50 billion over the next three-to-five years. With a market cap of $64 billion, Time Warner would be past the upper end of that range.
Time Warner’s stock spiked as high as 9 percent after the report came out, but fell back and closed up less than 5 percent on the day.
