AT&T fielding 'lowball bids' for DirecTV – reportAT&T fielding 'lowball bids' for DirecTV – report
But AT&T is reportedly still pushing forward with a plan to unload its struggling satellite TV division despite opening round bids of less than $20 billion, well below the $49 billion paid in 2015.
October 6, 2020
The next time you peer into a bargain bin, don't be surprised to find DirecTV in there.
Undaunted by "lowball bids" for its struggling satellite TV unit, AT&T is still pushing ahead with an auction for DirecTV, the New York Post reported Tuesday.
The auction is "shaping up to be a fire sale," the report added, noting that AT&T last week invited a "handful" of potential suitors – largely made up of private equity firms – into a second round of the auction. Dish Network is reportedly not participating in the auction, despite a recent declaration from Dish founder and chairman that a merger of Dish and DirecTV was "inevitable."
The first-round bids valued DirecTV at below $20 million, according to the pub, citing sources familiar with the process. An opening bid from Apollo Global Management reportedly came in at about 3.5 times DirecTV's approximate $4.5 billion of EBIDTA, implying a valuation of about $15.75 billion.
A new TV on a showroom floor in Tallahassee, Florida, circa 1957. Photo courtesy of the Tallahassee Democrat Collection.
AT&T acquired DirecTV for almost $50 billion in July 2015. Amid sharp satellite TV subscriber losses, AT&T has largely relegated DirecTV to rural areas without access to solid broadband connections. AT&T, meanwhile, has been pivoting its pay-TV business to AT&T TV, a relatively new contract-based, big bundle offering that's delivered via the Internet. It also continues to sell AT&T TV Now, an OTT-TV service formerly known as DirecTV Now that is contract-free and fitted with slimmer channel bundles. AT&T has already halted the sale of U-verse TV, its legacy IPTV service.
AT&T CEO John Stankey, who proclaimed more than a year ago that AT&T was not interested in unloading DirecTV because he expected the satellite TV unit to have a key role in its advanced ad initiatives (AT&T is also trying to sell its Xandr ad-tech unit), is now "scrambling" to unload DirecTV in a process being led by Goldman Sachs, according to the paper.
It's possible that AT&T could retain a minority stake in DirecTV or take a deal that involves multiple partners, according to an earlier report by The Wall Street Journal.
— Jeff Baumgartner, Senior Editor, Light Reading
About the Author(s)
You May Also Like
5G Network Automation and AI at Global Megaevents: A Telco AI-at-scale case study with Ooredoo and EricssonOct 10, 2023
5G Transport & Networking Strategies Digital Symposium.Oct 26, 2023
Improve Service Efficiency in the Call Center and Field with Slack AutomationOct 13, 2023
Open RAN Evolution Digital Symposium Day 1Jul 26, 2023
Dec 1, 2023