DirecTV will buy rival Dish TV from EchoStar (SATS), forging the largest U.S. pay-TV provider. Earlier Monday, AT&T (T) agreed to sell its remaining 70% stake in DirecTV to private equity firm TPG (TPG) for about $7.6 billion.
AT&T stock rose slightly and EchoStar fell. TPG stock dipped.
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DirecTV Deals
DirecTV will acquire EchoStar’s video distribution business, including Dish TV and the streaming service Sling TV. It will pay just $1, but assume $9.8 billion in debt.
The deal requires bondholders to write off some $1.6 billion in Dish-related debt.
A variety of U.S. regulatory agencies must sign off on the deal. The Federal Communications Commission blocked a merger between the two satellite TV providers in 2002.
Private-equity firm TPG will give $7.6 billion in cash payments through 2029 for the remaining 70% stake in AT&T. AT&T sold a 30% stake in 2021 to TPG.
AT&T will exit the entertainment business with the deal, in line with its strategy of paring debt on focusing on its wireless and broadband businesses.
AT&T acquired DirecTV for $48.5 billion in 2014.
AT&T Stock
AT&T stock edged up 0.5% to 22.01 shortly after the open Monday. The Dow Jones component hit a three-year high of 22.34 on Sept. 16.
EchoStar stock slumped 4.9% to 26.67.
TPG stock slipped 3 cents to 57.98.
Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.
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