AP Photo/Carlos Osorio

The U.S. Department of Justice has told AT&T that it would be required to sell CNN as a condition of approval for its proposed $85 billion acquisition of Time Warner, according to The Financial Times. The report adds that AT&T is opposed to such a divestiture, and is prepared to take the Trump Administration to court.

Axios has further learned that the DoJ request is to divest Turner Broadcasting, which is CNN's parent company.

Context: AT&T has been steadfast in saying that the overall merger does not create competitive overlap, and it does not currently own any cable news networks that rival CNN. But President Trump had threatened to block the merger during last year's campaign, and has been particularly critical of CNN's coverage.

Update: AT&T CEO Randall Stephenson issued a statement denying reports that his company offered to divest itself of AT&T:

"Until now, we've never commented on our discussions with the DOJ. But given DOJ's statement this afternoon, it's important to set the record straight. Throughout this process, I have never offered to sell CNN and have no intention of doing so."

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