AT&T;, MediaOne Deal May Be Delayed a Year : Telecom: Time Warner raises objections, according to SEC filing. Merger may be postponed to next summer.

AT&T; Corp. may have to delay its planned $53-billion purchase of MediaOne Group Inc. until Aug. 3, 2000, because of objections raised by Time Warner Inc., according to a regulatory filing.

Time Warner, which is a partner with MediaOne in Time Warner Entertainment, has said that--unless Time Warner gives its permission--terms of the partnership agreement don’t permit completion of the merger until a year after MediaOne moved to give up its management rights in Time Warner Entertainment, AT&T; said in a proxy filing with the Securities and Exchange Commission. MediaOne took that step Aug. 3.

A yearlong wait to complete the MediaOne acquisition “could delay our ability to realize the expected financial and operating benefits of the merger,” AT&T; said in the filing.

AT&T; and MediaOne “disagree” with Time Warner’s interpretation of the partnership agreement, the filing said.

“If Time Warner does not consent to an earlier closing, AT&T; and MediaOne may have to delay completing the merger to Aug. 3, 2000,” the filing said. The companies now hope to combine by March 31. If the agreement is not completed by then, the target date will be changed to Sept. 30.

The acquisition of MediaOne would make AT&T; the largest U.S. cable-TV company.

MediaOne gave up its management rights in Time Warner Entertainment in a step to remove possible complications from non-compete provisions of its partnership with Time Warner.

MediaOne owns 25.5% of Time Warner Entertainment, which controls most of Time Warner’s cable systems, the HBO network and Warner Bros. Studio, and had a 50% stake in its cable operations.

The proxy filing Friday also disclosed that, under terms of AT&T;’s acquisition of MediaOne, the Englewood, Colo.-based company would have to pay AT&T; a $1.6-billion termination fee if its board or shareholders fail to approve the merger.

That’s on top of $1.5 billion that MediaOne would have to pay AT&T; if the merger is terminated for reasons other than, for example, failure to meet regulatory conditions. That amount would represent repayment of $1.5 billion that AT&T; loaned to MediaOne so it could terminate an earlier agreement to be acquired by Comcast Corp.

On Friday, AT&T; shares fell $2.44 to close at $47.50; MediaOne fell $2.19 to close at $68.75. Both trade on the New York Stock Exchange.