AT&T To Buy DIRECTV for $67 Billion

[whitewolf8214]

Stephenson: FCC's rules no longer holding back investment
May 18 2015, 10:22 ET | By: Jason Aycock, SA News Editor

After a pause, AT&T (T +0.4%) looks ready to move forward with new investment on the expectation that new net neutrality rules will get changed either by the courts (AT&T is party to action in federal court) or Congress.
CEO Randall Stephenson had suggested that the company pause a plan to spend billions while they awaited the final rules from the FCC on how the industry would be regulated.
Now: "So we've said we're going to invest around $18 billion this year. That will allow us to deploy a wireless broadband solution to 13 million homes around the U.S.," he said on CNBC. "That compares to about $22 billion last year."
AT&T extended its deadline for acquiring DirecTV (NASDAQTV) as it expects to close the deal in Q2 and many observers think the acquisition will be done at least by July.
http://seekingalpha.com/news/253003...h:7f3e45b9da01947f4b843c7e70501a7e#email_link

 

[whitewolf8214]

AT&T Chief Says DirecTV Deal Will Turn Telco Into A Streaming TV Power https://www.yahoo.com/tv/s/t-chief-says-directv-deal-131504711.html

AT&T announced its $48.5 billion DirecTV acquisition plan a year ago today. And as they head toward an expected approval by the Justice Department and FCC, AT&T CEO Randall Stephenson told investors this morning that the combo will transform his company into a juggernaut in the fast-growing streaming video market."The traditional linear [TV] model is about to change in a significant way" as viewing on mobile devices grows, he said in a keynote at the J.P. Morgan Global Technology, Media and Telecom Conference. Once AT&T has a nationwide TV, wireless, and retail infrastructure "we're going to be in a unique position" to offer TV Everywhere streaming and other online services including Hulu.AT&T also hopes to capitalize on unique offerings. It has NFL games including DirecTV's NFL Sunday Ticket package. It's also making content deals through its Otter Media joint venture with Peter Chernin, who Stephenson calls "one of the best creative minds in Hollywood."If all goes as planned, "we go from our video business being a money loser to being a money maker."He also talked up opportunities to invest in wired fiber optic lines in AT&T's territories. He credits Google for improving the economics of these deals. Before it started to build its Google Fiber systems in Kansas City and Austin, most cities insisted that builders commit to upgrade the entire area — not just the well-to-do neighborhoods."It's not economic to build an entire city with fiber from day one," the AT&T chief says. When Austin allowed Google to pick its spots, "we got the deal that Google got." AT&T now passes about 100,000 homes in the city "and the penetration rates are terrific."AT&T vows to offer wireless broadband to about 13 million homes, mostly in rural America. It will be "truly competitive" with cable, and Stephenson is "getting more and more enthusiastic about it."

 

[stejamand]

STUPID AUTO CORRECT ... thats VRAD, not Brad.

That's good. I think Brad wants internet too.

 

[Poke]

AT&T, DirecTV Extend Merger Deadline Date

http://www.dslreports.com/shownews/ATT-DirecTV-Extend-Merger-Deadline-Date-133832

 

[whitewolf8214]

It's Time To Say Goodbye To DirecTV, Hello AT&T
May 26, 2015 9:30 AM ET | 9 comments | About: DIRECTV (DTV), Includes: T

Disclosure: The author is long T. (More...) http://seekingalpha.com/article/321...27g7:1am8tcn:b9edf81d0643a4226acc6b5e6c564b69
Summary

WSJ reports the FCC and DOJ will soon make a decision on the T/DTV merger, giving AT&T the go ahead.
Based on the terms of the agreement, DTV now has limited upside, if any at all.
Meanwhile, AT&T remains a terrific long-term investment opportunity, even better with the inclusion of DTV.

It seems like the long wait for AT&T (NYSE:T) and DirecTV (NASDAQTV) shareholders is over. The Wall Street Journal reported that the FCC and DOJ are near complete with their reviews of the merger, and that a decision should be announced soon. Investors anticipate an outcome in favor of AT&T, and in preparation, it is now time for DirecTV shareholders to embrace their new investment in AT&T, or to sell DirecTV shares in favor of AT&T.

AT&T's offer price for DirecTV was $95, thereby suggesting that DTV still has another $3.50 of upside once the merger is complete. That however is false, as $28.50 of the transaction is cash whereas the remaining $66.50 is AT&T stock. The $95 a share offer was based on AT&T's stock price on May 16. Had AT&T's stock price risen significantly, so would DirecTV's per share buyout price. Instead, AT&T shares have declined 5.5%, meaning that DirecTV has essentially no upside remaining.

That's why DirecTV shareholders would be best served to go ahead and sell their stock and buy AT&T. With 30% of the offer in cash, any short-term stock gains for AT&T will be more significant than in DirecTV's stock. In other words, if AT&T were to trade higher by 10% over the next month, DirecTV would only gain 7% in the same period. So, for investors who plan to own stock in AT&T following the merger, it makes more sense to go ahead and make that transition now.

For DirecTV investors who are still in limbo of whether or not they will invest in this new pay-TV/mobile juggernaut, the benefits for AT&T are robust. The acquisition will dilute AT&T's stock to the tune of 15%, but based on the free cash flow of both companies over the last 12 months, it'll increase AT&T's FCF by well over 30%.

Not to mention, AT&T expects cost savings of $2.5 billion three years after the merger is complete, suggesting significant free cash flow growth on cost cuts alone. Then, there are countless vertical and horizontal expansion opportunities in Latin America, Mexico, and with U-Verse among others. All these things are rolled into one stock trading at 13.5 times next year's earnings that pays a 5.5% annual dividend yield. What's not to like?

 

[whitewolf8214]

AT&T/DirecTV deal review still paused at FCC
May 28 2015, 19:47 ET | About: AT&T Inc. (T) | By: Jason Aycock, SA News Editor

The "shot clock" on the FCC's review of AT&T's (NYSE:T) purchase offer for DirecTV (NASDAQTV) -- the 180-day period where the agency vets the deal -- is still in pause, even though deal reviews will be starting to pile up behind it (Charter-TWC, Avago/Broadcom).
The FCC paused the clock in mid-March with just 10 days left, and while it's an informal deadline, it can be used to get more documents for review.
That pause was due to a court case on third-party programming contracts, and that was decided weeks ago.
AT&T, for its part, is submitting more documents in hopes of getting the review moving again. http://seekingalpha.com/news/2550376-at-and-t-directv-deal-review-still-paused-at-fcc#email_link

 

[whitewolf8214]

Report: AT&T to agree to concessions for DirecTV deal
Jun 2 2015, 12:13 ET | About: AT&T Inc. (T) | By: Jason Aycock, SA News Editor

With a federal review now in its endgame, AT&T (T +0.4%) is ready to make concessions in order to seal its $49B deal for DirecTV (DTV +0.2%), The Washington Post reports.
Speculation has centered on whether AT&T would embrace the FCC's new net neutrality rules regardless of the outcome of its pending litigation -- and the company appears ready to do so in several areas to get the deal done.
Along with offering stand-alone broadband plans that might encourage cord-cutting, AT&T would honor a ban on blocking and throttling (slowing down) sites, as well as agree to refrain from "paid prioritization" -- where companies pay Internet providers to get into a "fast lane."
Several details are unclear, though, including how long AT&T would need to abide by the commitments (earlier reports suggested several years), or what its broadband-only plans would have to look like in speed and price (opponents want 25 MBps for $30/month; AT&T's countered with 6 MBps for $35/month).
Also still a thorny issue: interconnection fees that have seen content firms wrestling with carriers over who's paying for heavy traffic from the likes of Netflix.
Previously: AT&T/DirecTV deal review still paused at FCC (May. 28 2015) http://seekingalpha.com/news/2550376-at-and-t-directv-deal-review-still-paused-at-fcc
http://seekingalpha.com/news/255725...ee-to-concessions-for-directv-deal#email_link

 

[Poke]

To secure Direct TV, AT&T will reportedly agree to abide by FCC's net neutrality rules

http://www.theverge.com/2015/6/2/8713205/att-direct-tv-net-neutrality-fcc

 

[meStevo]

Rules they'll have to adhere to anyways, just conceding the fight.

 

[Zashel]

lawyers gotta get paid somehow, you expect them to fight against their paycheck?

 

[Voyager6]

Rules they'll have to adhere to anyways, just conceding the fight.

Not if a Court rules against the FCC which is very likely. By voluntarily agreeing to follow the rules, ATT/DirecTv will HAVE to follow them as terms of the merger.

 

[Juan]

Not if a Court rules against the FCC which is very likely. By voluntarily agreeing to follow the rules, ATT/DirecTv will HAVE to follow them as terms of the merger.

Like Comcast?

 

[Voyager6]

Like Comcast?

Exactly like Comcast agreed to when they bought NBC/Universal.

 

[Juan]

Exactly like Comcast agreed to when they bought NBC/Universal.

Well how did that work out?

 

[Voyager6]

Well how did that work out?

They have been caught and groups are still watching Comcast.
http://www.truth-out.org/news/item/1163:report-shows-comcast-violated-conditions-of-nbc-merger
http://www.hollywoodreporter.com/news/senator-al-franken-comcast-nbcuniversal-320951
http://arstechnica.com/tech-policy/...-already-violating-conditions-of-nbcu-merger/
http://www.dslreports.com/shownews/FCC-Fines-Comcast-for-Violating-NBC-Merger-Condition-120121

 

[Juan]

They have been caught and groups are still watching Comcast.
http://www.truth-out.org/news/item/1163:report-shows-comcast-violated-conditions-of-nbc-merger
http://www.hollywoodreporter.com/news/senator-al-franken-comcast-nbcuniversal-320951
http://arstechnica.com/tech-policy/...-already-violating-conditions-of-nbcu-merger/
http://www.dslreports.com/shownews/FCC-Fines-Comcast-for-Violating-NBC-Merger-Condition-120121

No punishment other than a merger rejection

 

[dfergie]

The American Cable Association has urged the Federal Communications Commission to heed past AT&T-DirecTV concerns about access to regional sports networks and apply conditions to ensure the companies' proposed merger does not result in higher prices for rivals' access to DirecTV's four owned RSNs, which operate as Root Sports Northwest, Pittsburgh, Rocky Mountain and Southwest. ACA says program-access rules are not sufficient protection against the incentive and opportunity for the combined company to charge competitors -- including smaller cable operators lacking in discretionary income -- higher prices for those RSNs. In a filing in the merger docket, ACA said that "AT&T and DirecTV themselves have a long history of raising the same concerns as ACA about vertically integrated programmers, particularly with respect to access to RSN programming, the very programming assets at issue in this proceeding."

multichannel.com

 

[Jimbo]

The American Cable Association has urged the Federal Communications Commission to heed past AT&T-DirecTV concerns about access to regional sports networks and apply conditions to ensure the companies' proposed merger does not result in higher prices for rivals' access to DirecTV's four owned RSNs, which operate as Root Sports Northwest, Pittsburgh, Rocky Mountain and Southwest. ACA says program-access rules are not sufficient protection against the incentive and opportunity for the combined company to charge competitors -- including smaller cable operators lacking in discretionary income -- higher prices for those RSNs. In a filing in the merger docket, ACA said that "AT&T and DirecTV themselves have a long history of raising the same concerns as ACA about vertically integrated programmers, particularly with respect to access to RSN programming, the very programming assets at issue in this proceeding."

multichannel.com

In English .... anyone ?

 

[Tampa8]

Oh, I got an answer on that one. The gall of the "American Cable Association." They want to prevent Direct from doing EXACTLY what they do, withhold or demand high prices for DirectTV owned RSN's. I give you exhibit "A", of Cable doing exactly that, Comcast Philadelphia CSN sports.

 

[Tampa8]

And the demands just keep on coming... DirectAtt must carry every local in every market.
http://katyonthehill.com/network-tv-affiliates-ask-for-conditions-on-att-directv/