AT&T Selling Puerto Rico, U.S. Virgin Islands Operations to Reduce Debt

October 9, 2019 9:22AM PT

AT&T is selling its wireless and wireline operations in Puerto Rico and the U.S. Virgin Islands to Liberty Latin America for $1.95 billion in cash.

AT&T has been on a mission to reduce its enormous debt load from last year’s $85 billion acquisition of Time Warner through asset sales and other cost-control moves. Earlier this year, AT&T sold its 10% stake in Hulu to Disney for $1.4 billion as it tries to whittle down the red ink that as of July stood at about $150 billion.

“This transaction is a result of our ongoing strategic review of our balance sheet and assets to identify opportunities for monetization,” said AT&T chief financial officer John Stephens. “But doing so only made sense if we received a fair value from a buyer that is committed to taking this well-run business, with its skilled employees and loyal customer base, and help it thrive.”

The transaction, announced on Wednesday, is subject to review by the Federal Communications Commission and the U.S. Department of Justice. The two companies expect the deal to close within six to nine months.

AT&T said it has already surpassed its monetization goal of a net $6 billion to $8 billion in 2019. With this deal, the total of completed or announced monetization efforts this year is more than $11 billion.

AT&T has been pressured by activist shareholder Elliott Management Corp., which has been advocating divestments of some assets. The company reports third quarter earnings on Oct. 23.

“The combination of AT&T’s leading mobile and wired businesses with Liberty Puerto Rico’s leading high-speed broadband and TV business will create a strong and competitive integrated communications player,” said Liberty Latin America president and CEO Balan Nair.

This article was originally published by Variety.com. Read the original article here.

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