AT&T and Dish Network shares rose in after-hours trading Friday following a report that AT&T is again talking to prospective buyers for DirecTV.
The Wall Street Journal reported Friday that AT&T has resumed conversations with private equity firms that have expressed interest in the satellite TV provider that has struggled with a steady and increasing stream of subscriber losses in the era of cord-cutting and the rise of streaming alternatives. Goldman Sachs is working with the telco giant on the sale.
AT&T is known to have considered a range of options for DirecTV for some time. A sale has become the most likely solution for AT&T as it manages financial pressures on the business and the debt load left on the books from the 2015 acquisition of DirecTV, for $49 billion, and Time Warner, for $85.4 billion in 2018.
AT&T declined to comment.
Likely bidders for DirecTV included Apollo Global Management and Platinum Equity, according to the Journal. AT&T shares rose 1.2% in after-hours trading following the Journal report. Shares in Dish, the second-ranked satellite TV provider, climbed even more on piggyback speculation that sale activity around DirecTV would be good for Dish.
DirecTV at present has about 17.7 million subscribers in the U.S., down from more than 23 million in 2018.. Dish has about 11.2 million subscribers. Dish shares climbed 6.2% in after-hours trading, on the heels of closing at $34.82. AT&T closed at $30.04 in regular trading.
The sale of DirecTV will underscore that AT&T made a bad bet on timing in its acquisition by paying top dollar just as the value of the asset began to decline precipitously. The sale price of the unit is expected to be around $20 billion, or less than half of what AT&T paid five years ago.
DirecTV’s struggles have come to represent the perfect storm that traditional MVPDs are facing at a time of declining video subscriber revenue and rising programming costs for the fleet of entertainment, sports and news channels they offer in large bundles to consumers.
"dish" - Google News
August 29, 2020 at 08:03AM
https://ift.tt/3hzCuqa
DirecTV Sale Talk Boosts Shares of AT&T and Dish - Variety
"dish" - Google News
https://ift.tt/2MXZLF4
No comments:
Post a Comment