April 30 AT&T Inc has approached DirecTV
about a possible purchase of the satellite TV company,
the Wall Street Journal reported, citing people familiar with
A deal would likely be worth at least $40 billion, DirecTV's
current market capitalization, the newspaper said.
A combination of AT&T and DirecTV would create a pay TV
network that could rival Comcast Corp if it completes
its purchase of Time Warner Cable Inc.
DirectTV is the nation's second largest pay TV provider
after Comcast and is followed by Dish Network. However,
it lags cable and phone companies in the broadband market.
Aggressive discounting to attract customers in a nearly
saturated wireless market is taking a toll on carriers such as
AT&T, forcing them to explore other areas for growth.
AT&T, the No. 2 U.S. mobile provider behind Verizon
Communications Inc, is expanding its broadband and video
AT&T has held talks with both Dish Network and DirecTV in
recent years, people familiar with the matter told the Journal.
AT&T and DirecTV have an agreement through which the
companies offer a co-branded version of DirecTV's satellite
television service across the 22 states where AT&T offers
residential broadband and voice service. (r.reuters.com/vyd98v)
DirecTV also sells AT&T's broadband services, including AT&T
U-verse High Speed Internet to existing DirecTV customers.
Dish Network Corp has also approached DirecTV for a
tie-up. There were reports in March that Dish Chief Executive
Charlie Ergen contacted DirecTV CEO Mike White to discuss a
Representatives for AT&T were not immediately available for
comment. DirecTV spokesman Robert Mercer said the company does
not comment on speculation.
Comcast Corp this week agreed to a three-way deal with
Charter Communications Inc as part of Comcast's efforts
to win regulatory approvals for its proposed $45 billion
purchase of Time Warner Cable.
(Reporting by Supriya Kurane and Soham Chatterjee in Bangalore;
Editing by Edwina Gibbs and Saumyadeb Chakrabarty)