DirecTV is once again a standalone company as AT&T has spun the satellite television provider off. AT&T had already announced earlier this year that it would spin its video properties into a new company. Now, DirecTV is a separate company and it will own AT&T TV and U-verse video services. The new company would be managed by private equity firm TPG. The equity firm already holds a 30 percent stake in the company. AT&T had sold the stake in DirecTV in February this year after losing millions of customers. The transaction is now officially complete and all the services will now operate under DirecTV.
As outlined, AT&T will still own around a 70 percent stake in the company. Under the deal, AT&T had received USD 7.1 billion in cash. The telecom giant said that the money would be used to pay off its massive debt. Part of the debt is because of the acquisition of the original DirecTV in the year 2015. As part of the deal at that time, the telecom giant had to pay USD 48.5 billion to complete the acquisition. To say that the deal did not work as expected would be like presenting the entire scenario mildly because the business had been losing customers even before the deal was signed.
While announcing the plan to sell a 30 percent stake in DirecTV earlier this year, AT&T chief executive officer John Stankey said that the company wants to focus on its connectivity and content businesses. Stankey said that 5G wireless and fiber would be a top priority for the company. Content for HBO Max was also mentioned by the AT&T boss. However, the company revised its strategy recently and said its focus is core business. The company has taken several steps in recent years to reduce its debts, selling off assets is one of them. The debts were accumulated because of the company’s massive multimedia acquisitions.