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REPORT: Private Equity Firm Wants to Merge DIRECTV and Dish into One Company Under AT&T

Stephanie Sengwe

It is no secret that DIRECTV has been having a rough time, so much so that reports came out in September, claiming that AT&T will be spinning it off into a separate public company. However, the telecommunication company declined those claims stating “DIRECTV is an important part of what we’re going to be doing going forward.” Now, yet another report by Fox Business is claiming that there is another rescue attempt for DIRECTV underway.

According to Fox Business, the private equity firm Apollo Global Management, along with another banker, are looking into a deal with AT&T that would allow the company “to offload some of the risk” of DIRECTV and maintain its satellite business. The deal also would merge DIRECTV and Dish into one company managed by AT&T. The investment firm would provide financing for the transaction and hold a minority equity stake along with Dish, but AT&T would still maintain control of DIRECTV and its more than 20 million customers

Though the deal would get AT&T about half of the $49 billion it paid for DIRECTV in 2015, benefits of having it in place outweigh the losses, Fox Business reports. It is structured in a way that relieves AT&T of its $20 billion DIRECTV debt.

It’s been a rough path since AT&T acquired DIRECTV — as the pay-TV service has seen massive losses. The service peaked in 2016 with 21 million subscribers, but with continuing losses which saw 778,000 premium TV subscribers churn last quarter — the service is left with just 17.9 million subscribers. And it’s not expected to get better, as they’ve already hinted that they will lose over 1 million subscribers in the third quarter.