AT&T to Monetize Majority Stake in Central European Media Enterprises

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AT&T Inc. has agreed to the terms of a transaction in which Central European Media Enterprises Ltd. (CME) will be acquired by an affiliate of the Czech investment firm PPF Group N.V. (PPF).

CME, which has broadcast operations in Bulgaria, the Czech Republic, Romania, Slovakia and Slovenia, announced in early 2019 that it was conducting a review of strategic options, including a potential sale of part or all of the company.

Under terms of the agreement, AT&T will receive approximately $1.1 billion in cash at close and will also be relieved of a $575 million debt guarantee. The sale is consistent with AT&T’s plans to monetize non-strategic assets as it continues to pay down debt.

Given the company’s confidence in reaching a net debt-to-adjusted EBITDA ratio in the 2.5x range by the end of this year, shareholders should expect that share buybacks will be in the mix in the fourth quarter of 2019, along with continued de-levering.

AT&T acquired its stake in CME with the acquisition of Time Warner, now WarnerMedia, in 2018. PPF’s acquisition of CME is expected to be completed during the second quarter of 2020, subject to the receipt of regulatory approvals and the satisfaction of customary closing conditions.

AT&T is a diversified, global leader in telecommunications, media and entertainment, and technology. It executes in the market under four operating units.

WarnerMedia is a leading media and entertainment company that creates and distributes premium and popular content to global audiences through its consumer brands including: HBO, Warner Bros., TNT, TBS, truTV, CNN, DC Entertainment, New Line, Cartoon Network, Adult Swim, Turner Classic Movies and others.

AT&T Communications provides more than 100 million U.S. consumers with entertainment and communications experiences across TV, mobile and broadband services.

Additionally, the company serves nearly 3 million business customers with high-speed, highly secure connectivity and smart solutions. AT&T Latin America provides pay-TV services across 11 countries and territories in Latin America and the Caribbean, and is the fastest growing wireless provider in Mexico, serving consumers and businesses.