DirecTV to become standalone company after AT&T, TPG Capital ink deal
AT&T has reached a deal with TPG Capital that will see struggling satellite TV provider DirecTV become its own standalone company.
Credit: AT&T
Under the terms of the arrangement, the deal will create a new company called DirecTV with an implied enterprise value of $16.25 billion. TPG Capital will take a 30% stake in the business, while AT&T will own the remaining 70%.
The deal has been in the works for months as AT&T has been looking for ways to offset the impact of DirecTV's subscriber losses on its results, Variety reports.
"This agreement aligns with our investment and operational focus on connectivity and content, and the strategic businesses that are key to growing our customer relationships across 5G wireless, fiber and HBO Max," said AT&T CEO John Stankey.
Although the agreement covers DirecTV, AT&T TV, and AT&T U-verse MVPD, it doesn't include AT&T's Latin American video operations, U-verse network assets, AT&T's Sky Mexico investment, or regional sports networks.
AT&T has also committed to absorbing $2.5 billion in net losses from the NFL Sunday Ticket package. The carrier will get $7.6 billion in cash from the new entity.
In the fourth quarter of 2020, DirecTV recorded a net loss of 617,000 subscribers. The company has seen a steady decline in subscribers for two years, though AT&T says the situation has improved in the past five quarters.
Credit: AT&T
Under the terms of the arrangement, the deal will create a new company called DirecTV with an implied enterprise value of $16.25 billion. TPG Capital will take a 30% stake in the business, while AT&T will own the remaining 70%.
The deal has been in the works for months as AT&T has been looking for ways to offset the impact of DirecTV's subscriber losses on its results, Variety reports.
"This agreement aligns with our investment and operational focus on connectivity and content, and the strategic businesses that are key to growing our customer relationships across 5G wireless, fiber and HBO Max," said AT&T CEO John Stankey.
Although the agreement covers DirecTV, AT&T TV, and AT&T U-verse MVPD, it doesn't include AT&T's Latin American video operations, U-verse network assets, AT&T's Sky Mexico investment, or regional sports networks.
AT&T has also committed to absorbing $2.5 billion in net losses from the NFL Sunday Ticket package. The carrier will get $7.6 billion in cash from the new entity.
In the fourth quarter of 2020, DirecTV recorded a net loss of 617,000 subscribers. The company has seen a steady decline in subscribers for two years, though AT&T says the situation has improved in the past five quarters.
Comments
move. Especially when the 70% owner keeps
throwing gas into said fire.
I agree. I bailed on FiOS TV a few months ago. I was paying $185 a month for 75mbs, 3 boxes, home media DVR (2 shows at once, max) and HBO. Now I have 200/200 Internet (FiOS) for $50 including new router, YouTube TV for $65 and free HBO Max through my ATT plan. I saved $70 a month, and that was with one of the most expensive streaming services. Best of all, I'm getting nearly 300mbps in actual usage. I miss nothing...I have really all the channels I'd watch, plus premium Netflix, HBO Max, Prime and Apple TV+.
Hands down for many yrs DTV have the best video quality expect during a heavy storm. Even Verizon FIOS quality was not that great, this is due to the how good their source quality if as well as the compression systems they were using including the box in your house. I would watch shows on friend FIOS and Xfinite service and i would still see video defects that I generally would not see with DTV.