Acquisition of DirecTV by AT&T

Acquisition of DirecTV by AT&T

DirecTV logo (pre-acquisition)
DirecTV logo (post-acquisition)
Initiator	AT&T Inc.
Target	The DirecTV Group, Inc.
Type	Vertical Merger
Cost	US$48.5 billion (cash and stock alone); equivalent to $66.27 billion in 2025 US$67.1 billion (assumed debt included); equivalent to $91.8 billion in 2025
Initiated	May 18, 2014
Completed	July 24, 2015
Resulting entity	DirecTV taken private and integrated as a subsidiary

AT&T Inc. announced on May 18, 2014, that it would acquire The DirecTV Group, Inc. (the largest Satellite TV provider), for $48.5 billion in a joint cash-stock deal, and assumed debts of $18.6 billion, for a total offer of $67.1 billion. ^{[1] [2]} AT&T sought to diversify into the media industry as its wireless business began to stall in growth. ^{[3] [4]} After U.S. regulatory agencies approved the purchase, on July 24, 2015, AT&T integrated DirecTV into its newly created entertainment division. ^[5] On November 30, 2016, The DirecTV Now streaming service was launched as AT&T's first direct-to-consumer platform. ^{[6] [7]} Despite hopes for success, DirecTV lost millions of subscribers, and calls grew for AT&T to sell it and refocus on telecommunications. ^[8]

On February 25, 2021, AT&T and TPG (a private equity firm) jointly announced that DirecTV would be spun off as a separate company. ^[9] Under the agreement, AT&T would retain a 70% majority stake in DirecTV, but would no longer oversee its day-to-day operations. The deal was finalized by August 2, 2021, with AT&T receiving $7.1 billion and TPG becoming the minority owner of DirecTV. ^{[10] [11]} By mid-2025, AT&T sold its majority stake to TPG, ending a decade of involvement with DirecTV and granting TPG full ownership. ^[12]

Background and Development

Main articles: History of AT&T, Breakup of the Bell System, and DirecTV

AT&T's history

The company to bear the name "AT&T" was founded on March 3, 1885 as American Telephone and Telegraph Company (or AT&T Corporation) by Theodore Newton Vail as a long-distance subsidiary of the Bell Telephone Company. By December 1899, the Bell Telephone's assets were transferred to AT&T, with the latter gaining control of the Bell System, a regional network of local telecom companies. Theodore Vail became AT&T's President in 1907 and under his leadership, AT&T gained a monopoly over the telephone sector in the United States. This near century dominance earned AT&T the nickname of "Ma Bell." In 1974, the U.S. Department of Justice sued AT&T on accounts of antitrust violations. AT&T challenged the lawsuit, but in 1982, it reached a settlement with the DOJ to break apart its Bell System monopoly into seven regional companies. On January 1, 1984, the Bell System came to an end and led to a reshaped telecom industry.

One of these regional companies, Southwestern Bell, emerged as the smallest, but after the passage of the 1996 Telecom Act, deregulated telecom rules allowed SBC to become a major telecom company. AT&T briefly became the largest cable and broadband company by the end of the 20th Century, but later deconsolidated to exit those industries. In 2005, SBC acquired its former parent, AT&T, and took on its branding as AT&T Inc, while retaining its previous business history. The newly reincorporated AT&T acquired BellSouth in 2006 and reconstituted much of its former Bell System. By the early 2010s, growth of the wireless industry began to stagnate.

Former DirecTV headquarters in El Segundo

See also

Acquisition of Time Warner by AT&T

References

1. D'Orazio, Dante (May 18, 2014). "AT&T to acquire DirecTV for $48.5 billion". The Verge. Archived from the original on May 19, 2014. Retrieved November 19, 2025.
2. "AT&T to buy DirecTV for $48.5 billion as cellular growth eases". CNBC. May 19, 2014. Retrieved November 19, 2025.
3. "AT&T looks to life beyond cellular with DirecTV buy". May 19, 2014. Retrieved November 20, 2025.
4. Gibbs, Colin (November 15, 2015). "AT&T's move into media prompted by a 'steady deterioration' in wireless, analyst says | Fierce Network". www.fierce-network.com. Retrieved November 20, 2025.
5. Gryta, Thomas (July 24, 2015). "AT&T Closes $49 Billion DirecTV Buy". Wall Street Journal. ISSN   0099-9660. Archived from the original on October 16, 2015. Retrieved November 19, 2025.
6. Spangler, Todd (November 30, 2016). "DirecTV Now Debuts, Reveals Full Channel Lineups". Variety. Retrieved November 20, 2016.
7. Welch, Chris (November 30, 2016). "DirecTV Now: everything you want to know". The Verge. Archived from the original on December 26, 2016. Retrieved November 20, 2025.
8. Szalai, Georg (September 9, 2019). "AT&T Stock Jumps as Activist Investor Calls for Changes, Raises Questions About Time Warner Deal Benefits". The Hollywood Reporter. Retrieved November 21, 2025.
9. Sherman, Alex; Bursztynsky, Jessica (February 25, 2021). "AT&T to spin off DirecTV, AT&T TV Now and U-Verse into new company valued at $16.25 billion". CNBC. Retrieved November 20, 2025.
10. James, Meg (August 2, 2021). "DirecTV breaks free from AT&T". Los Angeles Times. Archived from the original on August 3, 2021. Retrieved November 20, 2025.
11. Bloom, David (May 20, 2021). "Insights: AT&T, Verizon Say "Never Mind," Set Off Next Era Of Media Consolidation". Tubefilter. Archived from the original on January 23, 2022. Retrieved November 21, 2025.
12. Manfredi, Lucas (July 3, 2025). "AT&T Closes Sale of 70% DirecTV Stake to TPG". TheWrap. Archived from the original on July 14, 2025. Retrieved November 20, 2025.