AT&T and DIRECTV have entered into a $67 billion agreement under which AT&T will acquire DIRECTV in a stock-and-cash transaction for $95 per share based on AT&T’s Friday closing price. The agreement has been approved unanimously by the boards of both companies.
The deal would face scrutiny from the Federal Communications Commission, which will also look at a proposed merger of Time Warner Cable and Comcast.
AT&T vowed to keep net neutrality rules for three years regardless of how the Federal Communications Commission rules on the issue. Leading cable and telcom providers have been pushing for a “fast lane for Internet speeds ” that critics claim would hamper access to the Internet.
AT&T operates the second largest cellular data network in Delaware. The addition of DirectTV would allow it to compete with rivals Verizon and Comcast without installing a cable infrastructure.
DIRECTV is a satelllite TV provider in United States and Latin America,. AT&T has a nationwide mobile network and a high-speed broadband network that will cover 70 million customer locations with this transaction.
The transaction enables the combined company to offer consumers bundles that include video, high-speed broadband and mobile services, according to a release.
AT&T is feeling pressure from cable giant Comcast, which is moving ahead with plans to acquire Time Warner Cable, a transaction that would make it a more formidable competitor to AT&T
“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 – mobile devices, TVs, laptops, cars and even airplanes. At the same time, it creates immediate and long-term value for our shareholders,” said Randall Stephenson, AT&T CEO. “DIRECTV is the best option for us because they have the premier brand in pay TV, the best content relationships, and a fast-growing Latin American business. DIRECTV is a great fit with AT&T and together we’ll be able to enhance innovation and provide customers new competitive choices for what they want in mobile, video and broadband services. We look forward to welcoming DIRECTV’s talented people to the AT&T family.”
DIRECTV has the exclusive pay TV rights to NFL SUNDAY TICKET that provides every out-of-market game, every Sunday afternoon, on TV, laptops and mobile devices.
DIRECTV will continue to be headquartered in El Segundo, California, after the deal closes.
