Investing.com - The International Rating Agency Moody's stated that the sale of the American telecommunications company AT & T (NYSE: T) 30% of the DIRECTV video service shares of the private investment company TPG Capital is a positive point in terms of a decrease in the company's debt writes Yahoo (NASDAQ: AAAABA) FINANCE.
The DirectV estimate is about $ 16 billion, which is significantly lower than $ 67 billion paid by AT & T (including debt) for DirectV in 2015.
TPG will pay $ 1.8 billion for its share of shares, including preferred shares with a yield of 10%. As the DirectV rating is low, the transaction is moderately positive for AT & T only because, as expected by Moody's, it will bring AT & T about $ 7.8 billion revenues, which will be used to compensate for the company's costs to carry out the auctions in the C range, which should speed up the reduction of the loan shoulder AT & T. The transaction also includes AT & T financing about 2.5 billion net losses from the NFL Sunday Ticket contract for the broadcast of the seasons of the National Football League 2021 and 2022.
The decrease in the DirectV estimate is largely due to constant pressure on the paid television industry, when consumers switch to platforms such as MVPD, video services via the Internet, video subscription on request and such paid platforms as Netflix (NASDAQ: NFLX), Disney + (NYSE: DIS) , Amazon Prime (Nasdaq: AMZN), CBS All Access, Hbomax and others.
Permanent obstacles, as well as competition for resources inside AT & T and the inability of the company to manage competitive services led to the fact that DirectV became one of the largest outsiders in the industry, and over the past two years has lost more than 7 million subscribers.
According to Moody's, DirectV is a ballast that reduces the overall assessment of the company's capital, and it is logical that the management will get rid of it by selling at least its part and conclusion of the transaction in such a way that this business is highlighted from AT & T.
Due to the pandemic, the company has shifted its strategic priorities and focuses on investing in fiber optic, 5G network and streaming, to restore the balance to the historical level of strength and on the support of dividends, which are among the highest on the market - 7.27%.
In addition, in the last year, the company sold several non-core assets.
In December 2020, the company announced the sale of its CRUNCHYROLL ANIME service for $ 1.175 billion Sony Pictures Entertainment, 100% subsidiary Sony Corporation (NYSE: SNE). In October 2020, the company also received about $ 3 billion from the sales of European media and real estate and from the sale of its wireless business in Puerto Rico and the Virgin Islands of the United States.
AT & T is the largest telecommunications company in the United States. In June 2018, AT & T completed the merger with Warner Media, adding global media platform media platforms and entertainment platforms Warner Bros., HBO and TURNER. AT & T revenue in the 2020 fiscal year was about $ 172 billion.
As of 19:30 Moscow time, the company's shares are decreasing at auction in New York by 0.51%.
- During the preparation of Yahoo Finance materials
Read Original Articles on: Investing.com