AT&T Inc (T.N) is exploring options for its business in Puerto Rico that could include a potential sale for around $3 billion, people familiar with the matter said on Thursday.
The sale process comes as AT&T, the second-largest U.S. wireless carrier, seeks to cut the debt pile it took on to purchase Time Warner Inc for $85 billion last year.
AT&T has hired a financial adviser to manage the sale process, the sources said, cautioning that it is possible no deal will materialise.
AT&T’s business in Puerto Rico comprises internet, TV, landlines and business services. It has around $300 million in 12-month earnings before interest, tax, depreciation and amortisation, the sources said.
Damage from Hurricane Maria, which hit Puerto Rico in September 2017, and a struggling economy have hampered the U.S. commonwealth’s telecoms market, according to a 2018 report by telecommunications consultancy BuddeCom.
Nevertheless, AT&T’s strong market position in Puerto Rico has attracted interest in the business from other media companies and private equity firms, one of the sources said.
The sources requested anonymity because the matter is private.
AT&T declined to comment.
AT&T has a market capitalisation of around $243 billion, with long-term debt of $164 billion as of the end of March. AT&T Chief Executive Randall Stephenson has said paying down debt is a major priority for the company. AT&T has already sold its stake in U.S. entertainment streaming service Hulu for $1.43 billion, and WarnerMedia’s Manhattan offices at Hudson Yards for about $2.2 billion.
Source: Reuters.com