AT&T has agreed to purchase Time Warner for $85.4 billion in a stock-and-cash deal that will merge AT&T's delivery networks with Time Warner's vast catalog of content. AT&T believes the combined companies will be able to save $1 billion per year once fully merged. The company says the acquisition will diversify its revenue mix thanks to the lower-cost, less-regulated content business from Time Warner. This will balance out the high cap-ex model currently run by AT&T and its wired and wireless networks, and DirecTV satellite service, which are all heavily regulated. The merger has been approved unanimously by both boards, but will require regulatory approval from the U.S. Department of Justice and the FCC. The transaction is expected to close before year-end 2017. The combined entity will compete with Verizon-AOL.