Global alternative asset management firm TPG will acquire from Dallas-based AT&T the remaining 70% stake in DirecTV that it does not already own in a deal valued at $7.6 billion. TPG said it will invest in DirecTV via TPG Capital, the firm’s U.S. and European private equity platform.
TPG is headquartered in Fort Worth and San Francisco. The acquisition is just part of a gamechanging multi-step deal that will see DirecTV merge with Dish Network into America’s biggest pay-TV provider.
AT&T said the sale will allow it to “continue to focus on being the leading wireless 5G and fiber connectivity company in America” and said the deal “continues to strengthen AT&T’s balance sheet by pulling forward cash expected over the next several years.”
“This transaction is the right next step for DirecTV as we advance our vision and continue to evolve our product to offer consumers the broadest array of content,” DirecTV CEO Bill Morrow said in a statement. “Our team is the best in the business, and we are driven to provide innovative video services with an outstanding customer experience. We are eager to deepen our support from TPG and invest in our video services to benefit customers nationwide.”
Under the terms of the deal, TPG will make an initial payment of $2 billion, subject to certain deductions, to AT&T during 2025 and additional payments to AT&T totaling $500 million in 2029. AT&T expects to receive around $7.6 billion in cash payments from DirecTV through 2029.
TPG said the transaction also contemplates that DirecTV will make a special distribution prior to March 31, 2025, of at least $1.625 billion that will be paid to the equity holders of DirecTV, proportional to their respective ownership positions.
The deal is expected to close in the second half of 2025. Upon its completion, DirecTV will continue to be led by its current management team, including Morrow.
Reinvigorating ‘a pioneer in pay TV’
DirecTV has operated since 2021 as a joint venture between AT&T and TPG consisting of DirecTV, DirecTV Stream, and U-verse video services previously owned and operated by AT&T. TPG said this transaction is expected to provide DirecTV with a stronger financial platform to increase investments in innovative video offerings that benefit consumers.
TPG said the deal will strengthen its existing partnership with DirecTV, and TPG’s proven expertise in the internet, digital media, and communications sectors will support DirecTV’s efforts to grow its next-generation streaming service, which has millions of subscribers and delivers multi-billion dollars of revenue annually.
“DirecTV is a pioneer in pay TV, and we are eager to continue to support the company’s innovation of value-oriented streaming and video offerings for consumers,” TPG Partner David Trujillo said in a statement. “DirecTV will be in a stronger position to reinvigorate its core product offerings and accelerate investment in its next-generation streaming service. We look forward to continuing to support DirecTV, alongside its talented team, to accelerate the company’s strategic vision.”
TPG Partner John Flynn said his firm is excited about the deal.
“DirecTV has a 30-year legacy of innovating for consumers while providing greater value and better service than incumbent providers, and we are thrilled to extend our highly successful partnership together. With this transaction, DirecTV will be better able to invest in advancing the next generation of video services that benefit consumers and provide a broad diversity of programming,” Flynn said.
Barclays is serving as lead financial advisor to TPG, and BofA Securities, Evercore, LionTree, and Morgan Stanley also provided financial advice, TPG said. Ropes & Gray LLP, Cleary Gottlieb Steen & Hamilton LLP, and Mintz, Levin are serving as legal advisors to TPG.
Founded in 1992, TPG is a global alternative asset management firm with $229 billion of assets under management and investment and operational teams around the world.
TPG invests across a broadly diversified set of strategies, including private equity, impact, credit, real estate, and market solutions, and said its unique strategy is driven by collaboration, innovation, and inclusion.
David Seeley contributed to this report.
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