AT&T nears deal with TPG to sell large minority stake in DirecTV, U-verse at $15 billion valuation
- AT&T is nearing a deal with TPG to sell a substantial minority stake in DirecTV, U-verse and AT&T TV.
- Transaction will value AT&T's video businesses at around $15 billion
AT&T is nearing a deal to sell a substantial minority stake in its DirecTV, AT&T TV Now and U-Verse business to private equity firm TPG, according to people familiar with the matter.
A deal could be announced as soon as this week, said the people, who asked not to be named because the discussions are private.
The deal will value the AT&T businesses around at $15 billion. AT&T acquired DirecTV in 2015 for $48.5 billion ($67 billion with debt).
AT&T has moved away from traditional pay TV in the past several years as it has centered its media strategy around HBO Max. DirecTV, U-Verse and AT&T TV Now are based around a linear TV business of broadcast and cable networks that is losing millions of subscribers each year.
AT&T lost nearly 3 million video customers last year and took a $15.5 billion impairment charge due to the company's reevaluation of its domestic video business.
A sale will provide AT&T will additional cash to pay down its debt, which stands at about $150 billion and has consistently declined through the past year.
Hedge fund Elliott Management took an activist stake in AT&T in September 2019. In a letter to management, Elliott asked AT&T to focus its strategic operations while considering divesting noncore assets -- including DirecTV. AT&T CEO John Stankey has resisted a full sale.
TPG and AT&T declined to comment.