The rumors that suggested a merger between AT&T and DirecTV have finally been confirmed by AT&T on Sunday, which said the deal is an attempt to expand in an ever increasing competitive cellular business arena.
AT&T intends on buying DirecTV, the top U.S. satellite TV operator, for $95 piece a share which amass to a whopping $48.5 billion. This amount however does not include the $19 Billion debt which DirecTV owes.
Randall Stephenson, the CEO of AT&T has remarked that:
This is a unique opportunity that will redefine the video entertainment industry and create a company able to offer new bundles and deliver content to consumers across multiple screens — mobile devices, TVs, laptops, cars and even airplanes.
He explained the purpose of the merger saying that it has been the goal the company has been striving for quite a while now.
“What it does is it gives us the pieces to fulfill a vision we’ve had for a couple of years – the ability to take premium content and deliver it across multiple points: your Smartphone, tablet, television or laptop,” Stephenson said.
The multibillion dollar deal which has the potential to alter the cellular market playing ground follows Comcast Corp’s footsteps as it awaits regulatory approval of its $45 billion acquisition for Time Warner Cable Inc.
On a side note, Comcast has declined to comment on the AT&T and DirecTV merger.
DirecTV, which will enable AT&T to offer its standalone services for 3 years, is headquartered in El Segundo, CA and will continue to operate as an independent company for a while after the deal closes.
To give a small background on DirecTV, it is an American direct broadcast satellite service provider with a huge client base. They have been known to boast regarding their programming, technology and high-quality video experience on major consumer digital devices.
Similarly, AT&T is an American multinational telecommunications corporation, headquartered in Dallas, Texas and is the largest provider of mobile telephony and fixed telephony in the United States. With the merger, the firm intends on providing high-speed broadband network to over 70 million customers.
This duo plans on becoming a leading content distributor across mobile, video and broadband platforms.
The merger will enable the multinational telecommunication giant to better serve the growing needs of its customers whether it be additional pay TV, on-demand video services like Netflix or Hulu streamed over a broadband connection (mobile or fixed), or a combination of viewing preferences on any screen.
The next step for the duo is to get regulatory officials on board regarding the merger in the United States and Latin America. AT&T expects this procedure to take at least twelve months.
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