AT&T is at loggerheads with US antitrust regulators over its $85 billion deal for Time Warner, as the operator also admitted the timing for closure of the deal is now “uncertain.”

According to Reuters sources, the US justice department wants AT&T to commit to significant asset sales, before approving the mega merger.

AT&T has been been asked to divest Turner Broadcasting, parent of news network CNN, or its DirecTV operation, to allay the regulator’s competition fears.

While sources said AT&T had agreed to sell CNN as a standalone, the US operator denied that this was the case.

AT&T CEO Randall Stephenson reportedly said in a statement the company “have never offered to sell CNN and have no intention of doing so”.

Deal uncertain
Meanwhile AT&T CFO John Stephens, speaking at an investor conference this week, said he couldn’t comment on the exact nature of “active discussions” with the US Department of Justice (DoJ), but reported “I can now say that the timing of the closing of the deal is now uncertain”.

The DoJ’s antitrust arm is currently reviewing the transaction, but AT&T previously indicated the merger was expected to close by the end of this year.

Approval from US antitrust officials is the only remaining regulatory obstacle for the merger’s completion, Stephens added.

Stephens’ comments come on the heels of a Wall Street Journal report earlier this month that the DoJ is laying the groundwork for litigation to stop the deal in its tracks. AT&T brushed off the report at the time, telling Mobile Word Live “it is common and expected for both sides to prepare for all possible scenarios” during DoJ reviews.

AT&T and Time Warner first announced their merger deal more than a year ago. The operator last month extended its timeline for the transaction’s close for a “short period of time” to await final regulatory approvals from US officials.