AT&T said Sunday it would sell its majority interest in the media company that operates in Central and Eastern European markets to PPF Group, a Czech Republic private equity concern. The deal will bring AT&T about $1.1 billion in cash and relieve the company of a $575 million debt obligation.
AT&T acquired the stake through its 2018 purchase of Time Warner. AT&T has been under pressure to pare down its debt load of $170 billion that it was left with after swallowing Time Warner for $85.4 billion. Time Warner bought its initial 31% stake in Central European Media Enterprises (CME) for about $241.5 million in 2009. Time Warner’s share of the company expanded over the years to about 42% of the equity as CME ran into debt trouble and relied on loans from Time Warner.
Founded in 1994, CME owns 30 channels that reach about 45 million viewers in five markets: Bulgaria, Czech Republic, Romania, Slovak Republic and Slovenia. It also produces original content.
AT&T is scheduled to report its third-quarter earnings on Monday. As of the second quarter, the company’s debt load stood at just under $160 billion. AT&T has sold numerous assets over the past year as it looks to bring its leverage ratio down to more traditional levels.
AT&T said the CME sale is expected to close in the second quarter of next year.
Separately, AT&T on Friday said its WarnerMedia unit would become the sole owner of HBO Ole Partners, a joint venture that has operated HBO-branded channels in Latin America and the Caribbean. WarnerMedia will take full ownership of the channels in Spanish-speaking territories. WarnerMedia and Ole Communications will remain partners on channels serving Brazil.
The former Time Warner and Ole Communications first established the HBO Ole Partners venture in 1991. WarnerMedia remains in business with Ole on other channels in Latin America.