AT&T: Negatives Of Selling Gaming Unit
AT&T is exploring selling their video gaming unit for a reported $4 billion.
The company has $154 billion in net debt so the cash isn't as meaningful as the lost revenues from WBIE.
The deal value is an apparent low valuation compared to public gaming stocks such as EA or Take-Two Interactive Software.
The stock will suffer from the constant hit to revenues per share while the 6.8% dividend yield is covered from the extra cash.
Due to the massive scale of AT&T (T) following the buyout of Time Warner, the company has looked for non-strategic asset sales to lower massive debt levels. One new target is the video game business from Warner Bros. due to the multi-billion valuation estimate thrown around by analysts.
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