AT&T completes purchase of Time Warner, ushering in new era for Warner Bros., CNN and HBO

Time Warner is no more.

AT&T Inc. announced late Thursday that it completed its $85 billion acquisition of Time Warner Inc., just two days after a federal judge in Washington gave the deal the green light. AT&T wasted little time consolidating its hard-fought prize – a blockbuster purchase that instantly transforms the phone company into a major force in Hollywood.

Television networks HBO, TBS, TNT, CNN, Cartoon Network, Turner Classic Movies and the Warner Bros. movie and television studio, based in Burbank, now have a new boss: John Stankey. The 55-year-old executive is a Los Angeles native and a 32-year veteran of AT&T and its predecessors.

Time Warner Chief Executive Jeffrey Bewkes will serve as a senior adviser to Stankey and AT&T during the transition.

“All of Jeff Bewkes’ direct reports will now report to John Stankey,” AT&T said in its statement.

AT&T and Time Warner have spent the past six months battling the Justice Department to gain its approval for the deal. The Justice Department sued in November, alleging AT&T would use Time Warner’s content to put its rivals at a disadvantage.

On Tuesday, U.S. District Judge Richard Leon ruled against the government, saying it had failed to prove its case that the AT&T-Time Warner combination was anticompetitive.

AT&T will separate its business into four distinct units: communications, which encompasses mobile phone service, broadband internet and DirecTV; advertising and analytics; international operations; and now the Time Warner properties, which last year generated $31 billion in revenue.

“We offer customers a differentiated, high-quality, mobile-first entertainment experience,” Randall Stephenson, chairman and chief executive of AT&T, said in a statement. “We’re going to bring a fresh approach to how the media and entertainment industry works for consumers, content creators, distributors and advertisers.”

Time Warner was formed by the 1990 merger of Warner Communications and Time Inc., the magazine empire. In 1996, it bought Turner Broadcasting. At one point, the company was one of the largest entertainment conglomerates in the world, churning out popular movies, 24-hour newscasts and such popular magazines as Time, People and Sports Illustrated.

It also orchestrated one of the worst mergers ever: Time Warner’s $165-billion sale in 2000 to AOL, the dial-up internet pioneer. A few months after the deal was finalized, the dot-com bubble burst and the company’s value plummeted.

The company’s roots date to 1923, when Polish immigrant brothers Harry, Albert, Sam and Jack Warner incorporated their pioneering film business in Los Angeles. Warner Bros. remains one of the industry’s jewels with such film franchises as “Wonder Woman” and “Harry Potter” and television shows such as “The Big Bang Theory.”

Separately, the first copy of Time magazine was published in 1923 and sold 9,000 copies. Time’s founders, Henry R. Luce and Briton Hadden, thought there would be a market among the college-educated crowd. But the digital era has not been kind to magazines, and Time Warner four years ago spun off the titles.

AT&T in its statement said it would announce a new name for the Time Warner unit later, and it wasted no time. Bloomberg, citing a person familiar with the matter, reported units new name was announced in an internal company memo. The name: WarnerMedia.

Earlier on Thursday, AT&T negotiated a settlement with the Justice Department to waive a waiting period for the closing, according to Bloomberg News. AT&T closed the deal about three hours later. AT&T was pushing to complete the transaction before a June 21 deadline, when its Time Warner merger agreement was due to expire.