James GordonWith the AT&T and DirecTV merger finally nearing the finish line, AT&T’s Latin American business, DirecTV Latin America, has just been sold to Argentina’s Grupo Werthein. The sale, which was worth $800 million, includes DirecTV Latin America’s Latin American satellite and cable businesses, and its satellite-satellite transponders.
An international consortium has acquired the business assets of AT&T’s Latin American satellite business in a deal that is expected to close in the fourth quarter of 2015. The transaction is expected to close on or around October 30, 2015, subject to customary closing conditions, and is expected to be accretive to adjusted EBITDA and free cash flow on a full year basis. The satellite network in Latin America has been 100% owned by AT&T since 2006.
AT&T bought DirecTV’s entire satellite operations in 2015 for about $49 billion, or $66 billion including acquired debt.
Matias Delaceoix/Bloomberg News photo
AT&T Inc. T -0.04% said it agreed to sell its Vrio satellite business in Latin America to Argentina’s Grupo Werthein, continuing the Dallas telecom giant’s move away from the television business.
The sale covers 10.3 million subscribers across 11 countries in the Western Hemisphere, including Argentina, Chile and Colombia, inherited from AT&T’s purchase of DirecTV. The wireless carrier said the sale will trigger a $4.6 billion accounting charge, which includes $2.1 billion tied to “accumulated foreign currency translation adjustments.”
AT&T is slated to report quarterly earnings on Thursday.
An AT&T spokesman said the transaction carries an enterprise value of $500 million, which will be paid over the next few years. The companies expect to close the deal in early 2022.
Vrio has faced difficulties specific to its home market, including as fluctuating foreign currency rates and economic downturns in important countries like as Brazil, where the company has a controlling interest in satellite-TV provider Sky Brasil. The firm already wrote down its operations in Venezuela, which were threatened by political tensions with the United States.
Vrio’s DirecTV client base hasn’t shrunk as fast as that of its American equivalent, where high-speed internet access has enabled tens of millions of consumers to ditch pay-TV in favor of less costly online options. Grupo Werthein stated in a statement that it intends to invest in the company to fulfill the requirements of its viewers. The family-controlled company is involved in a variety of industries in Argentina and Latin America.
AT&T is leaving the entertainment sector as it sharpens its focus on wireless and broadband service. The company in February struck a deal to sell a 30% stake in its U.S. pay TV operations to private-equity firm TPG while giving up operational control of the business, which will be called DirecTV upon closing. The companies assigned that deal an enterprise value of $16.25 billion, which included about $6.4 billion of debt.
AT&T bought DirecTV’s entire satellite operations in 2015 for about $49 billion, or $66 billion including acquired debt.
AT&T Latin America chief Lori Lee said the sale will allow the company to focus more on core telecom services.
“Through our cellular business in Mexico and services for international companies operating in the area, we remain committed to Latin America,” she added.
Drew FitzGerald can be reached at [email protected].
Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Appeared in the July 22, 2021, print edition as ‘AT&T to Sell Vrio Satellite Business In Latin America.’
Frequently Asked Questions
What does it mean by at?
At is short for at the.
What does ATT stand for?
ATT stands for Advanced Technology and Telecommunications.
What do you marvel at?
I marvel at the fact that you are asking me a question.
Related Tags
This article broadly covered the following related topics:
- vrio corp
- what is latin america
- vrio company
- vrio at&t
- directv latin america
James Gordon
