AT&T To Sell Puerto Rico Business As It Looks To Pay Down Debt 15
According to The Wall Street Journal, AT&T has agreed to sell its Puerto Rican and U.S. Virgin Islands businesses to Liberty Latin America for $1.95 billion in cash (Warning: source paywalled, alternative source), "allowing the telecommunications giant to shave its debt load and move closer to repurchasing shares." From the report: AT&T's operation in Puerto Rico provides cellular, landline and internet connections. It had 1.1 million wireless subscribers. As part of the deal, about 1,300 AT&T employees will be transferred to Liberty Latin America. The two companies said they expect the deal to close within six to nine months. Puerto Rico and the U.S. Virgin Islands account for a small sliver of AT&T's domestic operations, but shedding the unit will help it work down a large debt load accumulated through its $80 billion-plus acquisition of Time Warner last year. The deal signals progress on AT&T's goal of selling noncore assets, something activist investor Elliott Management Corp., which recently disclosed a stake in the company, is also pushing. AT&T has also sold its stake in streaming service Hulu.
Selling noncore assets... (Score:2)
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You know they've gone full-MBA when providing telephone service has become a "noncore" function of the telephone company. I'd like to start up a business where I can sell off and outsource everything except collecting the money!
Na.. well, kinda. The wrong decisions were made decades ago.
20-something years ago I had to do France and Italy for the USAF for half a year. I know, breaks the heart. Weather forecasting in Pisa. Mm. And Marseillies. Mm! Anyway, no one had land lines.
No. One. All the natives were on wireless. Yes, in the middish-late 90's.
Landlines cost too much, so cellphone was cheaper. Blew my mind, because back then here, everything was landline and cell was the province of the yuppie, the pretentious, and thos
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it's a tiny island and they probably have to buy bandwidth to serve it cause they may not have their own fiber. better sell it to someone who's got infrastructure in the area
it's non-core to their main US business
More to do with Puerto Rico than AT&T's debt (Score:3)
You don't make money in Puerto Rico without US government subsidies. The whole island's economy is essentially subsidized by Washington DC, and there's been rumblings that perhaps we'd be better off without PR. The island's debts are massive (especially for workers and retirees in the PR local government retirement system), with no realistic means to pay them off. This inevitably results in either a US Government bailout, or a default on those debts. AT&T probably sees the road ahead and wants out. Like the investment banks unloading mortgage backed securities before anyone knew what was in them, Ma Bell is probably grateful to shift this one to the suckers.
Re: More to do with Puerto Rico than AT&T's de (Score:1)
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To be fair, many of the islands financial problems were also caused by Washington DC and billion-dollar corps. There's a bunch of financially-destructive maneuvers that are illegal in the 50 states, but we totally let them fly in PR: https://www.youtube.com/watch?... [youtube.com]
And on to
Too much truth? (Score:3)
I like how the article says this sale of land line, cell and internet services is part of ATT's effort to sell off non-core assets.
At least they finally admit phone and internet is an afterthought for ATT.
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What is their core business, then? There were recently rumblings they might sell off the DirecTV stuff.
Repurchasing Stocks... (Score:2)
The key to this is, AT&T is looking to repurchase stocks... To boost share prices... Pretty much a trick to make a few people more wealthy, and sell off an asset that has already paid for itself and is making money. Short-term gain for selling a long-term asset.
Roaming charges? (Score:2)
Does this mean roaming to them will no longer be free that it isn't the same network?
Buy more satellite (Score:1)