AT&T is spinning off its DirecTV into a new company for a fraction of the $48.5 billion it paid for the satellite TV service in 2015.
DirecTV has lost millions of customers on AT&T’s watch, and is valued in the deal at just $16.25 billion, including debt.
Private equity firm TPG will own 30% of the business, while AT&T holds the rest. The telecom company will receive $7.8 billion in cash, including $1.8 billion from TPG and and $5.8 billion from the new DirecTV firm, which is borrowing that sum.
The new DirecTV will also take on $200 million in debt from AT&T. AT&T launched its streaming service HBO Max last year and has focused on building that business.