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(Reuters) – AT&T Inc is planning a major organizational reshuffle that will include a redefined role for Chief Executive Randall Stephenson following its $ 85.4 billion acquisition of Time Warner Inc, Bloomberg reported on Friday.
Stephenson will move to the role of executive chairman and oversee a pair of chief executives who will independently manage the company’s telecommunications and media businesses, according to the Bloomberg report.
John Stankey, who currently leads DirecTV and other entertainment businesses, will become CEO of the media division that would include HBO, Warner Brothers and news network CNN, Bloomberg reported, citing people familiar with the matter.
DirecTV will become part of a unit that includes AT&T’s traditional phone businesses, to be run by John Donovan, the report said.
AT&T said last month it was confident of winning regulatory approval for the acquisition of Time Warner before the year end, as the U.S. Justice Department continues to review the deal.
“While we acknowledge that tailwinds for AT&T’s shares have improved since the U.S. election, we believe its structure as a deal stock may temper its performance in the near term,” Barclays analyst Amir Rozwadowski said in a note on Friday.
U.S. President Donald Trump has been critical of Time Warner’s news division CNN in recent months, calling the outlet “fake news”. He had also expressed opposition to the merger during his election campaign.
A group of Senate Democrats including Bernie Sanders, Elizabeth Warren and Al Franken, had also urged the Justice Department last month to closely scrutinize the deal.
Time Warner had reported a better-than-expected first quarter profit in May as revenue from its box office hits offset declining ad sales, while AT&T in April missed revenue estimates due to lower equipment sales.
Shares of AT&T and Time Warner were largely unchanged in premarket trading on Friday. (Reporting by Kanishka Singh and Parikshit Mishra in Bengaluru; Additional reporting by Narottam Medhora; Editing by Amrutha Gayathri and Shounak Dasgupta)
