It's a deal: AT&T to acquire DirecTV

It's a deal: AT&T to acquire DirecTV
The boards of AT&T and DirecTV held special meetings on Sunday where they approved a plan for the latter to be bought out by the former for $95-per-share.

Rumors of the deal surfaced early last week and it was leaked then that a deal could be announced within days, and so it has, with both boards approving the deal simultaneously and unanimously. AT&T will acquire DirecTV in a mix of stock and cash.

AT&T trumps this deal as a creation of a “unique new competitor with unprecedented capabilities in mobility, video and broadband services.” It is expected that AT&T will use this new asset to augment U-Verse offers, which will, in turn, free up bandwidth demands in those markets.

DirecTV is already sold at many AT&T retail locations, and with a portfolio that includes NFL Sunday Ticket, and other sports oriented content offers, AT&T will be able to better bundle these services with its wireless line-up, including expanded delivery of content to mobile devices.

AT&T has issued a number of commitments as part of the transaction. AT&T plans to deploy broadband services to more rural areas by using fixed-wireless and fiber installations. A stand-alone broadband package with guaranteed pricing for three years. There will be a nationwide DirecTV pricing package, consistent for three years.

AT&T also commits to net-neutrality, regardless of any rulings that come from the FCC that may vacate such requirements. Finally, AT&T re-committed to participate in next-year’s spectrum auction, although it does point out the caveat “as long as there is sufficient spectrum available in the auction to provide AT&T a viable path to at least a 2x10MHz nationwide spectrum footprint.” The company notes that the deal with DirecTV will not stop it from spending at least $9 billion in the auctions in 2015.

Of course, regulators in Washington, DC, a few states, and some governments in Latin America need to sign off on the deal. Assuming everything moves forward, that process will take about a year.

source: AT&T

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