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DIRECTV Announces Proposed Notes Offering

DIRECTV Entertainment Holdings LLC (“DIRECTV”), a wholly owned subsidiary of AT&T Inc. (“AT&T”), announced today a proposed offering of $3.1 billion aggregate principal amount of Senior Secured Notes due 2027 (the “Notes”) by its indirect wholly owned subsidiaries, DIRECTV Financing, LLC, a Delaware limited liability company, and DIRECTV Financing Co-Obligor, Inc., a Delaware corporation (together with DIRECTV Financing, LLC, the “Issuers”).

The timing of pricing of the Notes is subject to market conditions and other factors. Concurrently with the anticipated completion of the transactions contemplated by the Contribution Agreement, dated February 25, 2021, among AT&T, AT&T MVPD Holdings LLC (formerly known as V Holdco LLC), DIRECTV and TPG VIII Merlin Investment Holdings, L.P (the “Separation Transaction”), DIRECTV Financing, LLC is seeking to enter into new senior secured credit facilities (collectively, the “new credit facility”). The Issuers intend to use the net proceeds of the issuance of the Notes, together with the net proceeds from the new credit facility, to pay down, in cash, intracompany indebtedness owed to AT&T and to pay or fund the reimbursement of certain financing expenses and shared transaction expenses, in connection with the anticipated completion of the Separation Transaction.

In the event that the Separation Transaction is not consummated substantially concurrently with, or prior to, the issue date of the proposed offering, the Issuers will deposit (or cause to be deposited) the gross proceeds of the proposed offering into an escrow account for the benefit of the holders of the Notes, to be released to the Issuers upon consummation of the Separation Transaction.  Following the release of the proceeds from escrow, the Notes will be fully and unconditionally guaranteed by each of DIRECTV Financing, LLC’s existing and future indirect and direct domestic subsidiaries (subject to certain exceptions) that incurs or that guarantees any obligations under the new credit facility.  Following the release of the proceeds from escrow, The Notes and related guarantees will be secured on a pari passu basis with the new credit facility on a first-priority basis by security interests in substantially all of the tangible and intangible assets of the Issuers and the guarantors that secure the new credit facility (subject to certain permitted liens and certain exceptions).

The Notes will be sold in a private placement only to persons reasonably believed to be qualified institutional buyers in accordance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and outside the United States to non-U.S. persons in accordance with Regulation S under the Securities Act.

The Notes have not been and will not be registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States or to, or for the benefit of, U.S. persons absent registration under, or an applicable exemption from, the registration requirements of the Securities Act.

This press release does not constitute an offer to sell or a solicitation of an offer to buy the Notes or any other security and shall not constitute an offer, solicitation or sale in any state or jurisdiction in which, or to any persons to whom, such an offer, solicitation or sale would be unlawful. Any offers of the Notes will be made only by means of a private offering memorandum.