TPG Fully Acquires DIRECTV from AT&T
TPG, the San Francisco-based private equity group and a leading global alternative asset management firm with $229 billion assets under management, said that it has reached an agreement to acquire the remaining 70% stake in DIRECTV, that it does not own, from AT&T.
TPG will invest in DIRECTV through TPG Capital, the firm’s US and European private equity platform, the company said on Monday.
Since 2021, DIRECTV has operated as a joint venture between AT&T and TPG consisting of DIRECTV, DIRECTV STREAM and U-verse video services previously owned and operated by AT&T. This transaction is expected to provide DIRECTV with a stronger financial platform to increase investments in innovative video offerings that benefit consumers.
This transaction will strengthen TPG’s existing partnership with DIRECTV, and TPG’s proven expertise in the internet, digital media and communications sectors will support DIRECTV’s efforts to grow its next-generation streaming service, which has millions of subscribers and delivers multi-billion dollars of revenue annually.
Under the terms of the transaction, TPG will make an initial payment of $2 billion, subject to certain deductions, to AT&T during 2025, and additional payments to AT&T totalling $500 million in 2029. AT&T expects to receive approximately $7.6 billion in cash payments from DIRECTV through 2029, TPG said.
The transaction also contemplates that DIRECTV will make a special distribution prior to 31 March 2025, of at least $1.625 billion that will be paid to the equity holders of DIRECTV, proportional to their respective ownership positions.
The transaction is expected to close in the second half of 2025, subject to customary closing conditions, including receipt of required regulatory approvals. Upon completion of the transaction, DIRECTV will continue to be led by its current management team, including its CEO, Bill Morrow.
Morrow said that this transaction is the right next step for DIRECTV as they advance their vision and continue to evolve their product to offer consumers the broadest array of content.
Bill Morrow added: “Our team is the best in the business, and we are driven to provide innovative video services with an outstanding customer experience. We are eager to deepen our support from TPG and invest in our video services to benefit customers nationwide.”
David Trujillo, Partner at TPG, said that DIRECTV is a pioneer in pay TV, and they were eager to continue to support the company’s innovation of value-oriented streaming and video offerings for consumers.
“DIRECTV will be in a stronger position to reinvigorate its core product offerings and accelerate investment in its next-generation streaming service. We look forward to continuing to support DIRECTV, alongside its talented team, to accelerate the company’s strategic vision,” he added.
Another Deal
Meanwhile, Financial Times reported that TPG was nearing a $7.8 billion deal to acquire the German metering company Techem, in a takeover that would rank among the largest such transactions between buyout groups in Europe this year.
TPG may reach an agreement to acquire Techem from Switzerland’s Partners Group. However, the timeline might yet slip and no final decision had been taken, the report said quoting people familiar with the matter.
Founded in 1952, Techem now has roughly 60 million devices around the world that offer homeowners and tenants data on their energy and water usage. It has nearly 4,300 employees and generates more than $1.11 billion of total sales.
The Singaporean sovereign wealth fund GIC will invest alongside TPG in the deal, according to people familiar with the matter, the report said and added that TPG will make the investment through its TPG Rise Climate fund, which is directed at sustainability-focused investments.
