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FLASH WORLD THE LARGEST FITCH REDUCED THE
TOBACCO COMPANY PERSPECTIVE OF
AT&T BUYS TIME IN THE WORLD WAS ITALY’S RATING
WARNER FOR 86 ESTABLISHED
BILLION DOLLARS
The American telecommunica- British American Tobacco of- The Agency Fitch reduced Italy’s
tions giant AT&T announced fered to buy the American tobac- credit rating, and the reasons
that it will buy the media group co company Reynolds American indicated by the Agency include
Time Warner for the amount of for an amount of 47 billion dol- the insufficient growth, the high
86 billion dollars, or 107.5 dollars lars. If the offer is realized, the debt, as well as the unstable polit-
per share. As the world media an- merge would result in the cre- ical condition caused by the out-
nounce, an agreement between ation of the largest tobacco com- come of the planned referendum.
the companies has already been pany in the world. BAT already In the last edition, Economy and
reached, and an approval from owns 42 percent of the shares Business wrote about this politi-
the regulators is still expected. in Reynolds American, and to cal adventure of Italy, and the in-
If the takeover goes well, this take over the rest, the company security which the referendum
means that the communication offers 56.50 dollars per share, creates in the Italian society,
giant AT&T will put under its which assumes in total 47 billion however there are already warn-
control the contents from the dollars for the remaining 57.8 ings by the rating agencies. The
movie studios of Warner Bros percent of the ownership share Italian referendum in November
and the cable televisions HBO, in Reynolds. As BAT announced, may initiate a series of political
as well as the television channel in the offer of 47 billion dollars, processes which would result in
CNN. ”This is a perfect match of approximately 20 billion dollars fall of the Prime Minister Matteo
two companies with complemen- are in cash, and 27 billion are in Renzi, and strengthening of the
tary advantages which can bring their own shares. If the agree- populist political option led by
fresh approach in the operation of ment is realized, this would im- the “Five Star movement” which
media and the communication in- ply that BAT, after a break of 12 strives for abandoning of the
dustry”, stated Randal Stephen- years, returns to the American European Monetary Union and
son, Chairman of the Board of markets. British American To- return of the lira. As indicated
Directors and CEO of AT&T. It is bacco is one of the largest mul- from the Agency, even the pos-
particularly this concentration tinational tobacco companies sible success of the referendum
of the distribution and the pro- with more than 200 own brands, is not a firm guarantee that the
duction of content which will be it has more than 50,000 employ- Eurosceptic political powers will
very carefully analyzed from the ees, and it sells 663 billion ciga- not impose their politics. The
anti-monopoly regulators in the rettes which it produces in 44 agency retained the credit rating
United States. Currently AT&T is factories worldwide. BBB+, however due to the high
the third largest cable operator level of trust of the Eurosceptic
in the United States. option, it considers that the risk
for reduction of the rating in the
near future is high.
Miroslav Sazdovski
68 November 2016
