Investing.com -- AT&T Inc (NYSE:T) announced Monday that it plans to sell its 70% ownership in satellite TV provider DirecTV to private equity firm TPG for $7.6 billion, marking the telecom giant's exit from a business that has seen dwindling returns.
The company’s shares climbed nearly 1% in premarket trading.
Back in 2021, AT&T entered into a joint venture with TPG, which invested roughly $1.8 billion for a 30% stake in DirecTV, then valued at around $16 billion.
AT&T had agreed to retain its share in DirecTV for three years, a restriction that ended on July 31.
By selling its stake, AT&T aims to streamline its focus on core areas like wireless and fiber connectivity, while also improving its financial position.
“This sale allows AT&T to continue to focus on being the leading wireless 5G and fiber connectivity company in America. This transaction also continues to strengthen AT&T’s balance sheet by pulling forward cash expected over the next several years,” AT&T said in the press release.
The company said it will receive an initial payment of $2 billion in 2025, with further payments to follow through 2029, according to a regulatory filing made on Monday.
It expects the transaction to close in the second half of 2025.