(Reuters) – AT&T Inc is dedicated to spend as a lot as wanted on the media enterprise of newly acquired Time Warner Inc, Chief Government Randall Stephenson informed CNBC on Friday, with a plan to take a position $21 billion to $22 billion within the mixed firm.
“We’re not going to be penny-wise and pound-foolish right here,” Stephenson mentioned in an interview on the monetary information channel. “We intend to take a position.”
The No. 2 U.S. wi-fi provider closed its $85 billion acquisition of Time Warner on Thursday and now faces the duty of integrating a media firm into its operations because it seeks to rival Netflix Inc, Amazon.com Inc and different expertise firms offering leisure on to prospects.
Time Warner might be renamed WarnerMedia, in keeping with a memo despatched to staff by John Stankey, who will function CEO of WarnerMedia.
Turner CEO John Martin will depart the corporate, in keeping with the memo, which was seen by Reuters.
Stephenson mentioned on Friday AT&T intends to protect Time Warner’s artistic tradition, albeit underneath a brand new title.
He acknowledged variations in an electronic mail to AT&T and Time Warner staff late on Thursday, a replica of which was seen by Reuters.
“As totally different as our companies are, I believe you’ll discover we’ve quite a bit in frequent,” wrote Stephenson. “We’re large followers of your expertise and creativity. And you’ve got my phrase that you’ll proceed to have the artistic freedom and assets to maintain doing what you do greatest.”
Stephenson informed CNBC he expects AT&T’s debt ranges to return down shortly in a few 12 months, returning to regular ranges inside 4 years at about 2.three occasions earnings earlier than curiosity, tax, depreciation and amortization.
Some analysts have raised considerations in regards to the excessive degree of debt the corporate took on to accumulate Time Warner, about $180 billion on the shut of the merger, Stephenson mentioned.
AT&T’s spending plans embody investing extra in HBO, the premium TV channel with the hit present “Sport of Thrones,” and increasing HBO’s direct-to-consumer platform, Stephenson mentioned.
Reporting by Sheila Dang; Further reporting by Diane Bartz in Washington; Modifying by Invoice Rigby