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Photo: AaronP/Bauer-Griffin/GC Images

AT&T is spinning off three of its video services, including its satellite TV brand DirecTV, to create a new standalone video company called New DIRECTV.

Details: The company will be jointly owned by AT&T and private-equity giant TPG. AT&T will retain a 70% stake and TPG will own 30% of the firm.

  • The new company will also include AT&T's digital skinny bundle service "AT&T TV" and its internet-based TV service "U-Verse."
  • The business will be operated as a standalone and is expected to be removed from AT&T’s corporate financial statements, according to a statement announcing the deal.
  • New DIRECTV will be jointly governed by a board of five people. Two board members will be representatives from AT&T and two from TPG. A fifth seat will go to the CEO of the new company, which at closing will be Bill Morrow, CEO of AT&T’s U.S. video unit.

Why it matters: Activist investors have pressured AT&T to sell DirecTV, which the company bought for $49 billion in 2014. The satellite TV business has been in secular decline for years as viewers switch to streaming.

By the numbers: The deal will value the three units combined at an implied enterprise value of $16.25 billion, about 1/3 of what AT&T bought DirecTV for 7 years ago.

  • Upon close of the transaction, AT&T will receive around $7.8 billion in cash to pay down debt. Nearly $6 billion of that will come from money that the new company will borrow from banks and pay AT&T back.
  • TPG will pay $1.8 billion in cash for its 30% stake.

Be smart: AT&T has been selling smaller assets for months in an effort to offload debt from its $85 billion acquisition of Time Warner in 2018. AT&T said in a statement that it will use the proceeds from the DirecTV transaction to pay down its debt.

Go deeper: AT&T signals ceasefire with activist investor

Go deeper

What we know about the victims of the Indianapolis mass shooting

Officials load a body into a vehicle at the site of the mass shooting in Indianapolis. Photo:

Eight people who were killed along with several others who were injured in a Thursday evening shooting at a FedEx facility in Indianapolis have been identified by local law enforcement.

The big picture: The Sikh Coalition said at least four of the eight victims were members of the Indianapolis Sikh community.

Pompeo, wife misused State Dept. resources, federal watchdog finds

Former Secretary of State Mike Pompeo. Photo: Joe Raedle/Getty Images

The State Department's independent watchdog found that former Secretary of State Mike Pompeo violated federal ethics rules when he and his wife asked department employees to perform personal tasks on more than 100 occasions, including picking up their dog and making private dinner reservations.

Why it matters: The report comes as Pompeo pours money into a new political group amid speculation about a possible 2024 presidential run.