AT&T obtained a conditional approval from the Federal Communications Commission (FCC) to acquire AT&T for $48.5 billion.
The Commission made the decision after conducting a careful and thorough review of the proposed transaction including economic analysis and documentary data from AT&T and DIRECTV. The FCC concluded that deal in the “public interest.”
FCC requires AT&T to expand broadband service
According to the FCC, it will require AT&T-DIRECTV to expand the deployment of broadband, fiber optic internet service to more locations in the United States covering 12.5 million customers including e-rate eligible schools and libraries.
The Commission prohibits AT&T-DIRECTV from using discriminatory practices to disadvantage online video distribution services. The FCC will also review its interconnection agreements.
The FCC will also require AT&T-DIRECTV offer broadband services to low income consumers at discounted rates.
The Commission explained that the imposed conditions address the potential harms presented by the AT&T-DIRECTV merger. It also ensures the realization of the benefits from the merger of the companies. The conditions will be implements for four years following the closing of the transaction.
AT&T is the largest telephone and internet service provider while DIRECTV is the largest satellite video provider in the United States.
AT&T completes transaction with DIRECTV
Separately, AT&T announced the completion of its transaction with DIRECTV today.
AT&T Chairman and CEO Randall Stephenson said, “This transaction allows us to significantly expand our high-speed Internet service to reach millions more households, which is a perfect complement to our coast-to-coast TV and mobile coverage.”
“We’re now a fundamentally different company with a diversified set of capabilities and businesses that set us apart from the competition,” added Stephenson.
AT&T will continue the deployment if its all-fiber GigaPower Internet access service, which allows customers to a TV show in just three seconds. The company’s all-fiber broadband footprint will reach more than 14 million customers upon completion of its expansion.
The shares of AT&T closed $34.30 a piece, up by more than 1% on Friday. The stock price of DIRECTV also climbed more than 1% to $93.55 per share.