News
A number of parties are reportedly interested in U.S. telco’s pay TV operations, but it has yet to make a decision on how to proceed.
Telefonica is interested in acquiring AT&T’s pay TV assets in Latin America, a transaction that could set it back US$10 billion, it emerged last week.
AT&T has yet to decide whether it will explore the possibility of brokering a deal with Telefonica, or if it will pursue other buyers, Reuters reported on Friday, citing unnamed sources.
One source said there are a number of parties interested in the assets in various different markets and that AT&T could choose to run several separate sale processes.
The same source named Liberty Global as a possible buyer, but did not share further details. Given that Liberty Global is named in virtually every M&A rumour at present, it is difficult to judge whether there is substance to the speculation.
AT&T gained a portfolio of pay TV businesses across the Latin American region through its US$48.5 billion acquisition of U.S.-based DirecTV in July. Late last year AT&T chief executive Randall Stephenson made it clear that he is not keen to hold on to those assets, because "they are single product companies and that’s not terribly exciting to us." However, he also said he is not in a hurry to sell due to the economic climate in the region.
Thus, Reuters’ assertion that the telco has yet to decide whether it will work with Telefonica on a deal or look elsewhere makes sense.
While those single product companies do not fit into AT&T’s converged operations strategy, they would augment Telefonica’s presence in the region. The Spanish telco has sizeable mobile operations across 14 markets from Mexico southwards.
According to the newswire, AT&T has around 19 million pay TV customers in Central and South America, making it the largest player in the region. It holds about 93% of Sky Brasil and owns PanAmericana, which offers satellite TV services under the DirecTV brand in countries including Venezuela, Argentina, Chile, Colombia and Puerto Rico, Reuters said. It is also a shareholder in Sky Mexico, which is controlled by Grupo Televisa.
