U.S based telecommunication company AT&T Inc. (T) will be selling around 30% of the stake it holds in its subsidiary DirecTV. The wireless carrier will be selling the stake to buyout firm TPG Capital.
This deal gives DirecTV’s business a market value of $16.25 billion. AT&T purchased the stake in DirecTV six years ago for $68 billion. This development was announced by AT&T on February 25.
In the first quarter of last year New DirecTV was launched in which AT&T has most of the channels offered in the platform. Some of the channels available on the platform include AT&T TV, DirecTV and U-verse video services.
New DirecTV has a net debt of $6 billion, after the sale transaction has been closed the platform will be managed jointly by AT&T and TPG.
In recent years, satellite television has been losing subscribers to online streaming platforms such as Netflix, Prime Video and Amazon. AT&T says it’s putting measures in place to have a shift to the streaming platform, these measures include setting up 5G infrastructure, fiber and streaming services.
“We certainly didn’t expect this outcome when we closed the DirecTV transaction in 2015, but it’s the right decision to move the business forward consistent with the current realities of the market and our strategy,” said the Chief Executive of AT&T John Stankey.