Mexico requires AT&T to leave Sky in order to approve the acquisition of Time Warner

The Federal Telecommunications Institute of Mexico (IFT, by its initials in Spanish) issued a release approving AT&T’s acquisition of Time Warner, as long as the deal meets certain conditions. One of them is that AT&T is no longer a shareholder for Sky Mexico. The US telecommunications company owns 41% of the DTH operator; the rest is controlled by Televisa Group. The IFT has also required the separation of AT&T from the operations of Time Warner’s HBO Latin America Group.

The regulator emphasized the “risk of AT&T coordinating with Televisa Group for anti-competitive purposes or effects”, as it could “prevent access to the provision and licensing of channels and packs of pay TV channels to third parties, establish entry barriers and push aside third parties in the market”.

The IFT also pointed out that the transaction would allow AT&T to “develop and provide video services through its multiple platforms, including AT&T’s mobile networks, which could increase the demand of mobile broadband and improve the use of their networks”.

In addition, the regulator stated that “in the mobile telecommunications markets, there weren’t identified any threats to the process of economic competition and free competition because AT&T faces other competitors, including Telcel.”

The merger is estimated to cost 85 billion dollars. It was announced in October 2016 and has already been authorized by the antitrust authorities of 16 countries, although three authorizations are still needed: Chile, United States and Brazil.