AT&T in Advanced Talks to Buy DirecTV for About $50 Billion: Reports

&T Advanced Talks Buy DirecTV About

AT&T is in advanced talks to acquire satellite TV leader DirecTV in a deal worth $50 billion, according to published reports.

The telco hopes to clinch a deal to buy DirecTV — which has about 20 million U.S. subscribers — within two weeks, according to a report in the Wall Street Journal, which broke the story late last month that AT&T had approached DirecTV about an acquisition.

Under the proposed pact, DirecTV CEO Mike White and other top management would continue to run the satcaster as a unit of AT&T until White retires sometime after 2015, Bloomberg reported, citing anonymous sources.

The telco is offering about $100 per share for DirecTV, according to Bloomberg’s report. In a later update, Bloomberg said the price could actually come in “close to $95 a share.” Reuters reported AT&T was discussing an offer for the satcaster in the low- to mid-$90s per share. DirecTV shares closed at $87.16 per share Monday.

Reps for AT&T and DirecTV declined to comment on the reports.

A tie-up between AT&T and DirecTV has been speculated about for years. But the parties have a new impetus in joining forces to take on Comcast, whose $45 billion bid for Time Warner Cable would produce an entity serving about 30 million U.S. TV subscribers.

Analysts have speculated that AT&T could migrate its 5.7 million U-verse TV subscribers to DirecTV’s satellite-delivered service, freeing up bandwidth in its terrestrial data networks. With 26 million pay-TV subscribers, AT&T would also gain leverage in programming negotiations on par with a merged Comcast-TW Cable.

An AT&T bid for DirecTV would face close regulatory scrutiny, and the companies expect a 12-month-long review process, Bloomberg reported.

Dish Network chairman Charlie Ergen, speaking on the satcaster’s first-quarter earnings call last week, said “there certainly is economic rationale” for AT&T acquiring DirecTV because it would be an accretive transaction for the telco. He said Dish has “no shot” in outbidding AT&T for DirecTV, adding: “We don’t want to pay a value for something that’s purely financial, not strategic.”

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  1. Guess I’ll depend on both the internet and Netflix. I currently have Direct TV after I dropped Dish, because I had my fill of Cable Companies. I am still the type of person that supports the lowest denominator, Independent Businesses, Local Retailers and Small Corporations. Dish is looking purchase T-Mobil, Comcast-Time Warner and more mergers and acquisitions. Soon there will be one communications company and we will really pay the price. Hey who wants to play Monopoly!?!?

  2. Joe McG says:

    AT&T may want to migrate their U-Verse customers, but how many of those live in housing that prohibits individual satellite dishes? All those apartments, condos, and other renters, not to mention those HOA controlled properties… what will their options be when AT&T cuts the cord? Talk about pushing customers in-between a rock and a hard spot!

  3. J.Hardcastle says:

    I do not like the idea. Directv is well managed and the PHONE people need to stay out of it

  4. Where do you think your rates are going when these two deals are made.

  5. Robbie Goldstein says:

    no to much at one time consumers will get killed

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