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DirecTV is once again a standalone company.
Six years after AT&T acquired the satellite TV giant in a $67 billion deal, the company on Monday was officially spun out as a standalone video-centric entity in a deal backed by private equity firm TPG.
The new standalone DirecTV also includes customers from AT&T’s UVerse video service, and was valued at $16.25 billion when announced earlier this year. AT&T still owns 70 percent of the company, with TPG holding 30 percent.
The new DirecTV will have a “singular focus” on video, CEO Bill Morrow said in a statement Monday, adding that “we are well positioned to bring unparalleled choice and value to all of our customers under one iconic brand whether they beam it or stream it.”
Indeed, despite its history as a satellite TV firm, the new DirecTV is placing just as much focus on streaming as it is on its legacy satellite business. The company will brand all its streaming efforts as DirecTV Stream, which will be accessible through common streaming devices, or the company’s own streaming box. It will also roll out a new logo and corporate branding scheme across all its services.
DirecTV also plans to position itself as a haven for sports fans, highlighting its delivery of live sports in 4K HDR, and its exclusive rights to NFL Sunday Ticket, the out-of-market NFL streaming offering which is expected to come up for renewal in the coming months.
The DirecTV spin off follows a wave of dealmaking by AT&T. The company sold its businesses in central Europe for $1.1 billion, and sold Crunchyroll to Sony for $1.2 billion.
It also struck a deal to spin out its WarnerMedia business in a merger with Discovery Inc. That deal would see Discovery’s executive team take over the combined company, but with AT&T shareholders holding the majority of shares in the company. It is a structure similar to that of the DirecTV deal.
AT&T’s move to unwind many of its acquisitions came a few years after the telecom giant faced pressure from activist investors at Elliott Management over its dealmaking.
John Stankey, who took over as CEO last year after the retirement of Randall Stephenson, suggested in June that the spate of deals the company had made were in some cases mistaken. Speaking at The Economic Club in Washington D.C., Stankey said of the DirecTV deal, “In hindsight, is that a transaction that one would have undertaken, if it knew everything it knew today? And the answer to that is probably not.”
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