Exclusive: TPG buying company leads AT&T DirecTV stock package – sources

(Reuters) – Private equity firm TPG has entered into exclusive talks to acquire a minority stake in AT&T Inc.’s satellite TV division, DirecTV, in an agreement that would allow US mobile operator to reduce its debt net of nearly $ 150 billion, people familiar with the matter said Friday.

The exact price that TPG is willing to pay could not be learned, but sources said the business could value DirecTV at over $ 15 billion. If the negotiations are concluded successfully, an agreement could be announced in the coming weeks, added the sources, who requested anonymity, because the matter is confidential.

AT&T and TPG declined to comment.

AT&T shares rose nearly 1% in the news, to an intraday high of $ 29.05, giving the company a market capitalization of nearly $ 210 billion. Shares closed unofficially on Friday at $ 28.92, up 0.3%.

Advanced discussions with TPG are the culmination of an auction that AT&T organized for DirecTV for several months. The deal would crystallize financial success for AT&T, which valued DirecTV at about $ 67 billion, including debt, when it agreed to buy it in 2014.

Since then, DirecTV has bled subscribers, with users switching to less expensive online streaming services such as Netflix Inc and Prime Amazon.com Inc.

AT&T said it lost 590,000 subscribers in the third quarter on its DirecTV, U-verse and AT&T TV platforms. It is under pressure to cut its growing debt pile as it invests more in 5G and other wireless services.

AT & T’s biggest deal, the $ 85 billion acquisition of media conglomerate Time Warner in 2018, has worsened following the COVID-19 pandemic, as a sinking in cinema has an impact on its film revenues.

WarnerMedia, the segment that includes HBO and the company’s film and TV studio, generated revenue of $ 7.5 billion in the third quarter of 2020, down from $ 8.4 billion in the quarter of a year ago.

However, thanks to several people looking for home entertainment, AT&T reported 38 million subscribers in the United States for both its premium TV channel HBO and HBO Max in the third quarter, reaching its 2021 target with a year earlier.

TPG, which has previously invested in companies in the sector, such as US regional cable operator Astound and Spanish broadcaster Univision, has assets under management of about $ 85 billion, according to its website.