Brazil’s anti-trust regulator is objecting to the proposed $85.4 billion (€78.5bn) merger between AT&T and Time Warner.
CADE (Conselho Administrativo de Defesa Econômica [Administrative Council for Economic Defense]), the Brazilian regulator, says the merger poses a “high risk” to competition, and as currently planned should be rejected unless the two businesses sell off some of their Brazilian divisions.
For example – although not mentioned specifically by CADE – there’s AT&T’s 93 per cent ownership of Sky Brazil, acquired when it bought DirecTV back in 2015.
“Both Sky and Time Warner have significant market power,” CADE said in its statement.
Larry Solomon, an AT&T spokesman, and quoted by Bloomberg, said the company still expects to close the deal by year end. “AT&T and Time Warner will work with CADE to clarify any issues they may have to promptly reach a final resolution on the matter,” the company said in a statement.
To date, the merger scheme has been approved by 16 nations, but Chile and the US itself has yet to approve the plan. Brazil’s stance might not help the situation.