AT&T Inc. announced today that it has agreed to acquire Time Warner Inc. in a transaction valued at $109 billion. AT&T plans to fund the equity purchase price of $85.4 billion with a combination of cash and stock. We expect the transaction will push AT&T's adjusted debt to EBITDA to around 3.7x, excluding synergies, from about 3.1x. We are placing our 'BBB+' corporate credit rating on AT&T and our 'BBB+' rating on its senior unsecured debt on CreditWatch with negative implications. The CreditWatch listing reflects the potential for a one-notch downgrade given high pro-forma adjusted leverage and the potential for integration-related risks, despite possible longer-term strategic benefits. On Oct. 24, 2016, S&P Global Ratings placed its ratings on Dallas-based telecommunications
