Reports: DOJ Could Seek CNN Sale Before AT&T-Time Warner Merger

FILE - In this May 26, 2015, file photo, the Time Warner Cable corporate logo is displayed at a company store, in New York. On Monday, April 25, 2016, the Justice Department approved Charter’s bid to buy Time Warner Cable and create another cable giant. Monday’s OK comes with conditions meant to preserve competition from online services. Additional approvals are required, but expected, before the deal closes. (AP Photo/Mark Lennihan, File)
Mark Lennihan/AP

The Department of Justice told AT&T that it would need to sell off CNN or offer other concessions in order to have its acquisition of Time Warner approved, according to several reports Wednesday. The reports differed slightly on the details.

The Financial Times first reported the news, citing three unnamed people with direct knowledge of negotiations over the $84.5 billion deal. Its sources said the Justice Department called for the sale of CNN specifically, though it noted that dropping CNN was “just one of the demands” the government had made in order to approve the deal. One unnamed source said CNN’s sale was one of two demands.

President Donald Trump has feuded with CNN since his days as a candidate, calling the network “fake news.”

Politico followed up on the FT report, though its unnamed sources “familiar with the discussions” said only that the DOJ’s expectations of “structural remedies” were being interpreted as an ultimatum to sell off CNN.

The New York Times, citing unnamed people “briefed on the matter,” said that AT&T and Time Warner had been told to sell off Turner Broadcasting, of which CNN is one of several cable channels. Two unnamed sources told the paper that the deal could alternatively go forward if AT&T sold DirecTV, the satellite TV provider it bought in 2015.

On Wednesday, responding to a reported Justice Department claim that he had offered to sell CNN, AT&T’s CEO, Randall Stephenson, refuted the claim and said “throughout this process, I have never offered to sell CNN and have no intention of doing so,” according to CNN’s Brian Stelter and Politico’s Michael Calderone.

“We are in active discussions with the D.O.J.,” AT&T CFO John Stephens told the New York Times earlier Tuesday. “I cannot comment on those discussions. But with those discussions, I can now say that the timing of the closing of the deal is now uncertain.”

In October 2016, AT&T and Time Warner said they had reached a merger deal, marking an especially massive consolidation in a media industry now used to them.

“We think AT&T has tremendous capabilities that we don’t have on our own,” Time Warner’s CEO said at the time, according to the Los Angeles Times. He cited AT&T’s mobile device-driven potential to deliver Time Warner content to its customers. “This is a unique combination.”

Still, the deal needs the Justice Department’s approval.

“It’s all about CNN,” one unnamed source with “direct knowledge” of the negotiations told the Financial Times.

During the 2016 presidential campaign, Donald Trump, who as President has been known to violate traditional barriers between his administration and the Department of Justice, said he was against the merger.

He said his administration “will not approve” the deal “because it’s too much concentration of power in the hands of too few.” White House adviser Kellyanne Conway denied on Sunday that the White House was intervening in the Justice Department’s work on the deal, Politico noted.

Stephenson has said in the past that selling off CNN “doesn’t seem relevant to approving a deal like this.” Last week, the Wall Street Journal reported that Trump’s Justice Department was weighing a lawsuit challenging the deal.

This post has been updated.