(CNBC) — A federal judge said Tuesday that AT&T’s $85.4 billion purchase of Time Warner is legal, clearing the path for a deal that gives the pay-TV provider ownership of cable channels such as HBO and CNN as well as film studio Warner Bros.

U.S. District Court Judge Richard Leon did not impose conditions on the merger’s approval.

Shares of Time Warner jumped nearly 5 percent in extended trading. Shares of AT&T dropped more than 2 percent.

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