One company may acquire another for a number of different reasons. The acquisition often has a significant impact on the financial statements. In 2017, AT&T Corporation acquired Time Warner. Obtain a copy of the AT&T 10-K filing for 2017. The 10-K reports the annual results for a company and is often available on the Investor Relations section of a company’s website. It is also available on the SEC’s website at www.sec.gov.

Required

Use the 10-K for 2017 to find the answers to the following questions about AT&T’s acquisition of Time Warner.

a. Provide at least one reason that AT&T acquired Time Warner. How did this acquisition benefit AT&T strategically?

b. What consideration did AT&T give to Time Warner shareholders?

c. How was the acquisition funded?

d. What type of acquisition discussed in this chapter describes this merger? Why would this type of merger be appropriate given the consideration given?