Updated at 10 p.m.
AT&T has announced it's buying Time-Warner in a cash-and-stock deal worth more than $85 billion, uniting one of the country's largest communications companies with a major content provider.
The deal was formally approved by the boards of both companies on Saturday.
"This is a perfect match of two companies with complementary strengths who can bring a fresh approach to how the media and communications industry works for customers, content creators, distributors and advertisers," said AT&T CEO Randall Stephenson, who will head the new company, in a statement. "It's a great fit, and it creates immediate and long-term value for our shareholders."
Dallas-based AT&T will pay $107.50 for each share of Time-Warner stock.
AT&T is a major provider of internet, wireless and telecommunications services to millions of people. By acquiring Time-Warner, owner of CNN, HBO and Warner Bros. studios, it will have access to a vast library of content that includes the Harry Potter franchise and "Game of Thrones."
The merger comes at a time when consumers--especially young ones--are increasingly eschewing cable TV and watching programming on their smartphones and wireless devices.
In its statement AT&T said the deal would leave it better positioned to capitalize on the changes.
"The new company will deliver what customers want — enhanced access to premium content on all their devices, new choices for mobile and streaming video services and a stronger competitive alternative to cable TV companies," the statement said.
AT&T is anxious to find new sources of revenue in part because its other businesses, such as wireless, aren't growing the way they once did.
"AT&T faces a tough 2017. While competition is generally tame within the wireless industry, many believe the dominant operators are about to enter a prolonged phase of share donation to Sprint and T-Mobile," wrote Walter Piecyk of the research firm BTIG.
This isn't the first time Time-Warner was part of a historic media merger. In 2000 it was acquired by AOL, in a deal that promised to fundamentally transform the media landscape but turned into one of the biggest disasters in corporate history (from 2003: AOL Posts Record $99-Billion Loss).
The size and scope of the AT&T deal, which has to be approved by the Justice Department, is already raising eyebrows in Washington.
"Such a massive consolidation in this industry requires rigorous evaluation and serious scrutiny," said U.S. Senator Richard Blumenthal. "I will be looking closely at what this merger means for consumers and their pocketbooks."
On the campaign trail Saturday, Republican presidential nominee Donald Trump said he would block the deal if he wins the election.
"It's too much concentration of power in the hands of too few," said Trump.