Boston, MA 05\/23\/2014 (wallstreetpr) \u2013 AT&T Inc. <\/b>(NYSE:T) <\/b>will acquire DIRECTV (NASDAQ:DTV) <\/b>for $95 per share based on Friday closing price of AT&T. The transaction intends to become a content distribution leader with unprecedented capabilities in broadband, video and mobile services.<\/p>\n
The Deal Transaction<\/b><\/p>\n
As per the term, shareholders of DIRECTV (NASDAQ:DTV) will receive $95.00 per share including $28.50 cash per share and $66.50 per share in AT&T stock. Even, the stock portion will subject to a range based on AT&T\u2019s closing price – shareholders of DIRECTV will receive shares at a range of 1.724 – 1.905 if the AT&T stock trading at price between $34.90 and $38.58.<\/p>\n
So, the transaction involves multiples of 7.7x 2014E EBITDA of DIRECTV, which includes $48.5 billion equity value of and $67.1 billion transaction value (including DIRECTV\u2019s net debt). DIRECTV (NASDAQ:DTV)’s shareholders will own 14.5%-15.8% of AT&T shares after the transaction.<\/p>\n
AT&T Inc. (NYSE:T) plans to fund the transaction primarily the cash part through a combination of available cash, external borrowings and sale of non-core assets and continues to maintain its balance sheet following the transaction. The merger expects to close within 12 months based on regulatory approvals from both the parties.<\/p>\n
Operational Advantage <\/b><\/p>\n
The Combination will diversify the source of revenue by accessing larger customer base spread across broadband, mobile and video and become a stronger alternative to cable. It will increase the distribution scale and expand its broadband coverage and improve its services.<\/p>\n
In addition, the combined company will provide integrated mobile video delivery platform for customers and create significant growth opportunities in pay TV services and also increase its presence in Latin America.<\/p>\n
Financial Benefit<\/b><\/p>\n
The combination will increase the operating efficiencies of AT&T Inc. (NYSE:T) that will be accretive to free cash flow and adjusted EPS within 12 months of transaction. In addition, DIRECTV (NASDAQ:DTV)\u2019s current strong cash flows will support investments for future growth opportunities to increase from video, broadband and entertainment.<\/p>\n","protected":false},"excerpt":{"rendered":"
Boston, MA 05\/23\/2014 (wallstreetpr) \u2013 AT&T Inc. (NYSE:T) will acquire DIRECTV (NASDAQ:DTV) for $95 per share based on Friday closing price of AT&T. The transaction […]<\/p>\n","protected":false},"author":9,"featured_media":21602,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"twitter_2902945987_2902945987":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[263],"tags":[1648,3051,6864,1705,1706,1104],"stock_ticker":[],"class_list":["post-23415","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology","tag-att-inc-nyset","tag-att-inc","tag-directv","tag-directv-nasdaqdtv","tag-nasdaqdtv","tag-nyset","entry"],"acf":[],"yoast_head":"\n