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AT&T to Acquire Time Warner

New company with complementary strengths to lead the next wave of innovation in converging media and communications industry.

AT&T Inc. (No. 4 on the DiversityInc Top 50 Companies list) and Time Warner Inc. (No. 37 ) announced October 22 they have entered into a definitive agreement under which AT&T will acquire Time Warner in a stock-and-cash transaction valued at $107.50 per share. The agreement has been approved unanimously by the boards of directors of both companies.


The deal combines Time Warner's vast library of content and ability to create new premium content that connects with audiences around the world, with AT&T's extensive customer relationships, world's largest pay TV subscriber base and leading scale in TV, mobile and broadband distribution.

"This is a perfect match of two companies with complementary strengths who can bring a fresh approach to how the media and communications industry works for customers, content creators, distributors and advertisers," said Randall Stephenson, AT&T chairman and CEO. "Premium content always wins. It has been true on the big screen, the TV screen and now it's proving true on the mobile screen. We'll have the world's best premium content with the networks to deliver it to every screen. A big customer pain point is paying for content once but not being able to access it on any device, anywhere. Our goal is to solve that.  We intend to give customers unmatched choice, quality, value and experiences that will define the future of media and communications.

"With great content, you can build truly differentiated video services, whether it's traditional TV, OTT or mobile. Our TV, mobile and broadband distribution and direct customer relationships provide unique insights from which we can offer addressable advertising and better tailor content," Stephenson said. "It's an integrated approach and we believe it's the model that wins over time.

"Time Warner's leadership, creative talent and content are second to none. Combine that with 100 million plus customers who subscribe to our TV, mobile and broadband services – and you have something really special," said Stephenson. "It's a great fit, and it creates immediate and long-term value for our shareholders."

View a message from Stephenson:

Time Warner Chairman and CEO Jeff Bewkes said, "This is a great day for Time Warner and its shareholders. Combining with AT&T dramatically accelerates our ability to deliver our great brands and premium content to consumers on a multiplatform basis and to capitalize on the tremendous opportunities created by the growing demand for video content. That's been one of our most important strategic priorities and we're already making great progress — both in partnership with our distributors, and on our own by connecting directly with consumers.  Joining forces with AT&T will allow us to innovate even more quickly and create more value for consumers along with all our distribution and marketing partners, and allow us to build on a track record of creative and financial excellence that is second to none in our industry. In fact, when we announce our 3Q earnings, we will report revenue and operating income growth at each of our divisions, as well as double-digit earnings growth.

Bewkes continued, "This is a natural fit between two companies with great legacies of innovation that have shaped the modern media and communications landscape, and my senior management team and I are looking forward to working closely with Randall and our new colleagues as we begin to capture the tremendous opportunities this creates to make our content even more powerful, engaging and valuable for global audiences."

Time Warner is a global leader in media and entertainment with a great portfolio of content creation and aggregation, plus iconic brands across video programming and TV/film production. Each of Time Warner's three divisions is an industry leader: HBO, which consists of domestic premium pay television and streaming services (HBO Now, HBO Go), as well as international premium & basic pay television and streaming services; Warner Bros. Entertainment, which consists of television, feature film, home video and videogame production and distribution. Warner Bros. film franchises include Harry Potter & DC Comics, and its produced TV series include Big Bang Theory and Gotham; Turner consists of U.S. and international basic cable networks, including TNT, TBS, CNN and Cartoon Network/Adult Swim. Also, Turner has the rights to the NBA, March Madness and MLB. Time Warner also has invested in OTT and digital media properties such as Hulu, Bleacher Report, CNN.com and Fandango.

Customer Benefits

The new company will deliver what customers want — enhanced access to premium content on all their devices, new choices for mobile and streaming video services and a stronger competitive alternative to cable TV companies.

With a mobile network that covers more than 315 million people in the United States, the combined company will strive to become the first U.S. mobile provider to compete nationwide with cable companies in the provision of bundled mobile broadband and video. It will disrupt the traditional entertainment model and push the boundaries on mobile content availability for the benefit of customers. And it will deliver more innovation with new forms of original content built for mobile and social, which builds on Time Warner's HBO Now and the upcoming launch of AT&T's OTT offering DIRECTV NOW.

Owning content will help AT&T innovate on new advertising options, which, combined with subscriptions, will help pay for the cost of content creation. This two-sided business model — advertising- and subscription-based — gives customers the largest amount of premium content at the best value.

Summary Terms of Transaction    

Time Warner shareholders will receive $107.50 per share under the terms of the merger, comprised of $53.75 per share in cash and $53.75 per share in AT&T stock. The stock portion will be subject to a collar such that Time Warner shareholders will receive 1.437 AT&T shares if AT&T's average stock price is below $37.411 at closing and 1.3 AT&T shares if AT&T's average stock price is above $41.349 at closing.

This purchase price implies a total equity value of $85.4 billion and a total transaction value of

$108.7 billion, including Time Warner's net debt. Post-transaction, Time Warner shareholders will own between 14.4% and 15.7% of AT&T shares on a fully-diluted basis based on the number of AT&T shares outstanding today.

The cash portion of the purchase price will be financed with new debt and cash on AT&T's balance sheet. AT&T has an 18-month commitment for an unsecured bridge term facility for $40 billion.

Transaction Will Result in Significant Financial Benefits

AT&T expects the deal to be accretive in the first year after close on both an adjusted EPS and free cash flow per share basis.

AT&T expects $1 billion in annual run rate cost synergies within 3 years of the deal closing. The expected cost synergies are primarily driven by corporate and procurement expenditures. In addition, over time, AT&T expects to achieve incremental revenue opportunities that neither company could obtain on a standalone basis.

Given the structure of this transaction, which includes AT&T stock consideration as part of the deal, AT&T expects to continue to maintain a strong balance sheet following the transaction close and is committed to maintaining strong investment-grade credit metrics.

By the end of the first year after close, AT&T expects net debt to adjusted EBITDA to be in the 2.5x range.

Additionally, AT&T expects the deal to improve its dividend coverage and enhance its revenue and earnings growth profile.

Time Warner provides AT&T with significant diversification benefits:

- Diversified revenue mix — Time Warner will represent about 15% of the combined company's revenues, offering diversification from content and from outside the United States, including Latin America, where Time Warner owns a majority stake in HBO Latin America, an OTT service available in 24 countries, and AT&T is the leading pay TV distributor.

- Lower capital intensity — Time Warner's business requires little in capital expenditures, which helps balance the higher capital intensity of AT&T's existing business.

- Regulation — Time Warner's business is lightly regulated compared to much of AT&T's existing operations.

The merger is subject to approval by Time Warner Inc. shareholders and review by the U.S. Department of Justice.  AT&T and Time Warner are currently determining which FCC licenses, if any, will be transferred to AT&T in connection with the transaction. To the extent that one or more licenses are to be transferred, those transfers are subject to FCC review. The transaction is expected to close before year-end 2017.

AT&T: Distracted Driving on Two Wheels: A New Reality

Break the habit and take the pledge to end distracted driving in and out of the car at ItCanWait.com.

Originally Published by AT&T.

By Ryan Luckey, Assistant Vice President, Corporate Brand Marketing

The roads can be a scary place. Drivers are taking their eyes off the road to look at their latest like, text or email.

And with the introduction of shared e-scooters, the latest in transportation innovation, it's more important than ever for riders and drivers to keep their eyes on the road.

One hand on the handlebar, another on the phone, then bam. You hit a pothole.

Tens of thousands of injuries – and hundreds of deaths – occur every year due to smartphone distracted driving. This is the unfortunate reality our AT&T It Can Wait program continues to address since 2010.

And now it's becoming clear smartphone distractions are no longer just a problem in the car.

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AT&T's First-Ever Untold Stories Film 'Nigerian Prince' Debuted in Theaters and On Demand Everywhere

The first film funded and distributed by ongoing Diversity & Inclusion Program from AT&T and Tribeca.

Originally Published by AT&T.

AT&T Presents: Untold Stories is proud to bring the program's first-ever film – NIGERIAN PRINCE – to audiences nationwide on Friday, October, 19. Untold Stories is a film initiative created by AT&T and Tribeca to ensure diverse voices in storytelling are heard and seen in theaters and living rooms across the country. Written and directed by newcomer Faraday Okoro, and filmed in Lagos, Nigeria, the film is a heist thriller about a Nigerian-American teenager sent to visit relatives in Nigeria against his will, later to join forces with his internet scammer cousin in an attempt to return to the United States on his own.

Kicking off the 2017 Tribeca Film Festival, Okoro was one of five aspiring directors who participated in a live pitch to a panel of celebrity and industry judges that included AT&T's chief brand officer Fiona Carter to win $1 million to make their film utilizing the Untold Stories program grant, mentorship and distribution commitments. Okoro's film, NIGERIAN PRINCE, had its world premiere at the 2018 Tribeca Film Festival to rave reviews and packed theaters in New York City. Now, delivering on the program's promise to ensure that underserved artists' work is not only created but seen, NIGERIAN PRINCE will be available to millions of movie enthusiasts in select theaters across the country as well as on DIRECTV, U-Verse and a range of on-demand platforms.

"Programs like Untold Stories have the incredible power to introduce audiences to new storytellers and new ways of seeing the world," said Jane Rosenthal, ceo and co-founder of Tribeca Enterprises/Tribeca Film Festival. "We're proud to support Faraday Okoro's globe-trotting, culture-crossing film NIGERIAN PRINCE as the first recipient of the Untold Stories grant, and we are eager to champion other emerging filmmakers as we continue to get untold stories heard with our friends at AT&T."

NIGERIAN PRINCE follows two characters: Eze, a stubborn, first generation Nigerian-American teenager and his cousin, Pius, who is a desperate Nigerian Prince scammer. After Eze's mother sends him to Nigeria against his will, Eze retaliates by teaming up with Pius to scam unsuspecting foreigners in order to earn money for a return ticket back to America. Executive produced by Spike Lee, the film stars Chinaza Uche and Antonio Bell.

AT&T Presents: Untold Stories. An Inclusive Film Program in Collaboration with Tribeca was launched in 2017 to ensure that diverse storytellers always have a screen on which to shine. AT&T will provide funding up to $1 million for one talented filmmaker to create his or her film each year, and Tribeca will provide mentorship from seasoned industry professionals. AT&T will distribute the winning film across its video platforms. This film initiative is an alliance between AT&T and Tribeca along with Tribeca Film Institute and debuted at the 2017 Tribeca Film Festival.

NIGERIAN PRINCE is the first film produced under the program. In April of 2018, AT&T awarded its second $1 million to Untold Stories winners Sasie Sealy and Angela Cheng for their film, LUCKY GRANDMA. Like NIGERIAN PRINCE, it will also have its world premiere screening during the 2019 Tribeca Film Festival next April. Submissions are now open for Year 3 – and aspiring filmmakers are encouraged to submit scripts between now and Nov. 24, 2018, for their chance to compete for a $1 million grant to make their film as part of AT&T Presents: Untold Stories.

For additional information about UNTOLD STORIES, please visit: http://about.att.com/sites/entertainment/untold_stories

AT&T: HACEMOS Drives Diversity in STEM

AT&T's HACEMOS group helps drive Latino diversity in STEM fields with 20th Annual High Technology Day.

Originally Published by AT&T.

School used to be all about the 3 Rs: reading, 'riting, and 'rithmatic. But the future is all about all about STEM – Science, Technology, Engineering, and Math. That's why HACEMOS, AT&T's Hispanic/Latino employee resource group, is introducing students to STEM during their 20th annual High Technology Day on Thursday, Oct. 18.

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AT&T Announces Largest Deployment of Free Aira Service

AT&T, Aira Use Groundbreaking Technology to Bring Retail Experience to Blind & Low- Vision Shoppers at Over 5,300 AT&T Retail Locations.

Originally Published by AT&T.

AT&T* and Aira continue to expand their relationship to bring new experiences to the blind and those with low vision. This time, it's the customer experience. All AT&T company-owned retail and authorized retail stores are now Aira Access Locations. That means that any member of the blind and low-vision community with a smartphone can become an Aira Guest and can get free use of Aira's service at over 5,300 AT&T retail locations across the U.S.

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AT&T: FirstNet Momentum: More Than 2,500 Public Safety Agencies Subscribed

The FirstNet Network Platform Has Been Reliably Supporting First Responders Battling Wildfires and Other Emergencies Nationwide.

Originally Published by AT&T.

More than 2,500 public safety agencies across the country have joined FirstNet. This is nearly double the number of agencies since the last update in July.

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AT&T: 6 Lessons I Learned Along My Journey to the C-Suite

Reputation is what others think of you. Character is who you are. It's something you own.

Originally Published by Linkedin.com.

By David Huntley, Senior Executive Vice President - Chief Compliance Officer

I had the honor of addressing the incoming class of full-time MBA candidates at SMU, my alma mater. After sharing how the continuous reinvention of my career parallels that of AT&T's, I provided 6 lessons I've learned along the way. At the encouragement of others, I'm sharing them with you. Regardless of your industry, profession, personal background or career aspirations, I hope you find value in them.

#1 Seek out and identify mentors and sponsors – No matter where your career path takes you, you'll always need the assistance of others, whether that's sponsors or mentors. To realize your fullest potential, you must seek out people who can help you throughout your journey. Some will be mentors: people willing to lend advice and help you find your way. Others will be sponsors: people that won't simply mentor you, but advocate on your behalf and champion your efforts. Having both will help you reach the career aspirations you've set for yourself.

#2 Persevere – Never give up. At times, you'll experience what you may see as roadblocks. They're not. They're simply speedbumps that require more introspection to help determine the right path forward. You must have the resolve to persevere. Struggle leads to progress. Just think, what would happen if Steve Jobs had stopped the first time he was fired from his own company. We probably wouldn't have the iPhone and Apple probably wouldn't be the first publicly traded trillion-dollar company. Instead, he persevered, stayed true and reached his goals.

#3 Be flexible and embrace change – Greek philosopher Heraclitus is cited as the source of the saying "change is the only constant in life." Joining AT&T as a junior lawyer almost 25 years ago, I expected to practice corporate law through retirement. That wasn't the case. I've spent roughly half of my AT&T career in the Legal department, the other half in operations. And while I'm not a practicing attorney today, I still lean on my legal background on a daily basis. Bringing a foundation in the law to an operations role has only increased my value. So, if change is constant, you must be able to embrace it. If you can't, you'll limit your career options.

#4 Stay relevant and be proactive – Always be learning. You can't stay relevant if you keep your head down. Identify your strengths and continuously develop them. If you have an interest in something, but lack the knowledge, do the work. Always be learning. Whether that's reading, attending training or going back to school, the only way you'll stay relevant is by knowing the latest trends. If you don't remain relevant, then the tools you possess will dull and your value will fall.

#5 Compete the right way – Who doesn't like competition? Healthy competition makes us better. It's when we compete by cutting corners, cheating or sabotaging others that we lose, even while "winning." Because those that you undercut will always remember. They may forgive you, but they'll never forget. And you never know who you might work with, or work for, in the future.

#6 Exercise humility – Admit that you don't have all the answers. The best leaders surround themselves with the best people, so they know who to go to when they don't know the answers. Every great leader also has great people behind them. No one gets to where they are on their own. The sooner you recognize this, the more effective you'll lead. And, one last thing, boldly recognize the great work of others. Give credit where credit is due. Who doesn't want recognition from time to time. This accomplishes two things. It shows your humility, endearing others to you. And it shows others you value their contributions and they're deserving of praise.

The Wrap Up

The last thing I left the MBA candidates with was the importance of character. You can do all the things I've shared above to help position you for success, but character is key. Reputation is what others think of you. Character is who you are. It's something you own. If you haven't started to really focus on it, you must. And while you do, keep integrity at the center.

After all, how do you want to be remembered?

WarnerMedia Secures Worldwide Media Rights to Tiger Woods vs. Phil Mickelson

Marquee Event Content to Include Shoulder Programming Airing on Turner's TNT & HBO's 24/7 Reality Franchise.

Originally Published by Time Warner.

WarnerMedia's Turner division has secured worldwide media distribution rights to "The Match," a historic head-to-head, 18-hole duel between Tiger Woods vs. Phil Mickelson. The highly anticipated showdown between two golfers – who have won a combined 19 Majors – will be hosted by MGM Resorts International and held Thanksgiving weekend at Shadow Creek in Las Vegas. The winner of this blockbuster pairing, featuring these two legends of the game, will walk away with $9 million.

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Montgomery County Transforms 911 Communications With AT&T

AT&T ESInet Boosts 911 Reliability and Enhances Emergency Communications.

Originally Published by AT&T.

Montgomery County is transforming its 911 communications with AT&T* ESInet™. The county recently joined others in the National Capital Region and selected the service from AT&T. The solution gives 911 call takers enhanced tools to speed their responsiveness and boost reliability to those in emergencies.

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