AT&T Inc. (NYSE:T) put off the sale of video game business of Warner Bros. It said the business is too valuable and look for alternative ways to pay the debt.
Home for popular titles
Warner Bros is a home for popular titles like Mortal Combat 11, Wizards Unite, and Harry Potter. According to a report in the June edition of CNBC, AT&T could have garnered $4 billion through offloading Warner Bros video business because several major companies showed interest in acquiring it.
Engages LineTree Advisors for sale
AT&T engaged LineTree advisors to divest its video gaming business early this year. Potential suitors for grabbing this video business from AT&T are Two-Take Interactive Software Inc., Microsoft Corp., Activision Blizard Inc., and Electronic Arts Inc. The decision to abandon the sale is arrived after a leadership change at AT&T. However, the decision could change in the future. Randall Stephenson relinquished the post of CEO whereas John Stankey assumed the role of CEO at AT&T in July.
A game changer for reversing the sale decision
AT&T could have reversed its decision to divest video gaming unit eyeing the potential revenues from upcoming Harry Potter game release that enables players to exploring Hogwarts wizard academy and take the roles as different characters. Following the closure of megapixels during coronavirus crises, people are searching for alternative ways of entertainment. Therefore, AT&T could benefit from releasing new video games just like blockbuster movies.
According to analysts, AT&T realized that sale of Warner Bros video business is complicated compared to early thoughts. The licensed content in the games comes with the attachment of long term strings.
Acquires for $85 billion
In 2018, AT&T purchased Time Warner Inc., a video game producer, for $85 billion. The company is also looking to divest its earlier acquired assets like DirecTV to reduce costs. DirecTV increased the debt of AT&T.
AT&T under the leadership of John invited bids for its declining TV service – DirecTV, the digital advertising unit – Xandr, and the anime streaming service – Crunchyroll to reduce the debt. In October, John said the company has no secret cows and moving the portfolios is on the table.