AT&T introduced earlier this yr that it could spin its video properties DirecTV, AT&T TV, and U-verse right into a new company it could co-manage with personal fairness agency TPG Capital. That transaction is lastly full, and the companies will now function as a single firm beneath the title DirecTV.
As outlined earlier this yr when the corporate initially introduced plans to off-load its struggling DirecTV enterprise, AT&T will retain a 70 % stake within the firm, whereas TPG will take a 30 % stake. The telecom big stated the deal for which it obtained $7.1 billion in money would assist repay its massive debt, with the corporate projecting it might probably put a cease to the bleeding by the top of 2023.
A part of that debt is owed due to AT&T’s acquisition of the original DirecTV in 2015, at which era AT&T paid $48.5 billion ($67 billion accounting for debt) to accumulate the enterprise. To say that that enterprise determination has didn’t ship is placing it mildly, as DirecTV bled customers for years previous to the TPG deal.
On the time the TPG deal was introduced in February, AT&T boss John Stankey stated that the corporate deliberate to focus particularly on “connectivity and content material,” together with 5G wi-fi and fiber in addition to its service HBO Max. Extra just lately, nonetheless, AT&T’s revised strategy is to deal with its core enterprise and as Stankey put it just lately, “unleash the media belongings.”
The cope with TPG doesn’t embrace any of WarnerMedia’s varied belongings, together with its marquee streaming service HBO Max, as a result of these are being offloaded to Discovery as an alternative. (WarnerMedia and Discovery are presently awaiting approval for the merger of their two corporations.)
However the deal will include present DirecTV content material offers for issues like NFL Sunday Ticket. AT&T added that DirecTV would “proceed to supply HBO Max to subscribers together with any bundled wi-fi or broadband companies and related buyer reductions.”