AT&T to buy DirecTV for nearly $50 billion

AT&T to buy DirecTV for nearly $50 billion

Summary: AT&T has closed a deal worth almost US$50b to acquire DirecTV, a third of which will be handed over to DirectTV shareholders in cash.


US telecommunications giant AT&T has clinched a deal to acquire broadcast satellite service provider DirecTV for nearly $US50 billion.

Shareholders are set to receive $US95 per share under the terms of the merger, including $US28.50 per share in cash and $US66.50 per share in AT&T stock, the companies announced on Sunday.

A statement said the transaction, approved unanimously by both boards, is based on a total equity value of $US48.5 billion and a total transaction value of $US67.1 billion, including DirecTV's net debt.

A merger between the two companies would create a potent rival to cable TV giant Comcast, which hopes to expand its coverage with the pending takeover of Time Warner Cable.

DirecTV has about 20 million customers, making it the No.2 pay-TV company in the US. It also has more than 18 million customers in Latin America.

AT&T said it would use the merger to expand plans to build and enhance high-speed broadband service to 15 million customer locations, mostly in rural areas.

"This is a unique opportunity that will redefine the video entertainment industry and create a company able to offer new bundles and deliver content to consumers across multiple screens," AT&T chairman and chief executive Randall Stephenson said in a statement.

DirecTV president and CEO Mike White said: "US consumers will have access to a more competitive bundle, shareholders will benefit from the enhanced value of the combined company and employees will have the advantage of being part of a stronger, more competitive company."

Topics: Broadband, Tech Industry

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.


Log in or register to join the discussion
  • Breakup the monopoly of cable companies

    The monopolies of Cable companies SHOULD be broken up really soon, especially with Comcast trying to buy TWC. I don't see any reason why cable companies are allowed to have monopolies in certain places in the United States. It is really bad for the consumers period! Consumers are paying sky high prices for cable and internet.
    Pollo Pazzo
    • There has never been

      true freedom of choice in cable in my lifetime. Cable is nearly always a limited monopoly - if you don't like it you can move, or use satellite or terrestrial.

      The idea of allowing AT&T to remove choice for so many is further proof that the FCC [in the entirety of the past 30 years] is simply a money sink for big business. It is a place for lobby money to gum up the wheels of progress, and stop the workings of any sort of anti-monopoly legislation.
      • Of course it is. Why would you think it wouldn't be?

        Governments are notorious for being filled with greed and corruption. Yet for some reason, more and more Americans think it's wise to hand more and more of our life over to it.
  • Telecoms and Cable Companies could be the future for content owners

    I hate to say this, but I believe content owners should get together with telecoms and cable companies, and essentially do an Amazon with them. I.e. telecoms and cable companies should come out with their own tablets, and entertainment apps on all platforms, and support digital newspapers, magazines, streaming video and audio services, etc. If their is a salvation for newspaper and magazine companies, it is with telecoms and cable companies, because they have paying subscribers, making it much more likely that they will prosper and obtain good prices for digital content.

    Artists should probably forget about music services like Spotify from which they make peanuts, and create their own apps on telecoms / cable company networks, and try to obtain subscribers there. I've heard a Pearl Jam Internet radio station, and I was surprised it sounded so good, and managed to keep things interesting for so long. I believe groups of artists should create apps on these networks, and produce live and on demand video, audio, digital magazine content, etc., and work on getting subscribers.

    My advice to content owners and artists is to try and get their content onto rich subscription networks like the type that will hopefully be provided by telecoms and cable companies, and use the web as a gateway to these networks. Move your content off the web into these subscription networks, so that they will acquire value, and so that you can make a buck.
    P. Douglas
    • Sarcasm?

      I'm guessing this is Sarcasm?

      Comcast owns its own content via NBCUniversal.
  • Get ready for price increases.

    They are going to have to finance that $50 Billion somehow...
    • Already started

      as a result of AT&T's failed bid for T-Mobile.
      Rabid Howler Monkey
  • So far Monday morning 9am EDT

    ATT stock is down > 2%, $0.78.
  • No surprises here.

    As we continue to move away from capitalism, consolidation will accelerate. It is only the very large companies that have the resources to buy the necessary political connections to stay in business.