uploads///long term debt of ATT verizon comcast

AT&T Looks to Sell Stake in GSN Games Unit to Reduce Debt

By

Jan. 16 2019, Updated 7:31 a.m. ET

GSN Games unit

AT&T (T), which has a 42% stake in GSN Games, is seeking to sell the unit of the GSN cable channel that produces social and casino games. Sony’s (SNE) Sony Pictures Entertainment owns 58% of the group and is also awaiting the buyers for GSN Games. The sale of the unit excludes the GSN cable network, which is also jointly owned by AT&T and Sony.

Article continues below advertisement

AT&T to reduce debt

The sale of GSN Games, which includes “Wheel of Fortune” and “Scrabble,” is valued at around $600 million–$700 million. Though the list of buyers is not known, the deal could also end up with Sony buying out AT&T’s stake. The sale of GSN Games is essential for AT&T, as the company is reportedly seeking to sell its non-core assets to pay off its debt load and maintain an “investment-grade” credit rating. AT&T is also focused on lowering its leverage ratio to 2.5 times its earnings by the end of 2019.

The second largest mobile carrier, AT&T, has a debt burden of around $170 billion following the $85.4 billion acquisition of Time Warner in June, making it among the most heavily indebted companies in the world. At the end of September 30, the company’s long-term debt stands at $168.5 billion, while free cash flow was $6.5 billion. Verizon (VZ) stands at $106.4 billion, while Comcast (CMCSA) has a long-term debt of $69.7 billion at the end of September 30, 2018.

As an effort to pay down the debt, AT&T is also looking to sell its 10% stake in Hulu, which it acquired through the Time Warner acquisition. Hulu is jointly owned by Walt Disney (DIS), 21st Century Fox, Comcast, and AT&T. Disney, Comcast, and Fox, each hold 30% in Hulu. Disney’s stake is slated to double to 60% after it closes its pending acquisition of 21st Century Fox in 2019.

Advertisement

More From Market Realist

    • CONNECT with Market Realist
    • Link to Facebook
    • Link to Twitter
    • Link to Instagram
    • Link to Email Subscribe
    Market Realist Logo
    Do Not Sell My Personal Information

    © Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.