By Phillip Swann
The TV Answer Man – @tvanswerman

AT&T CFO Pascal Desroches today said his company would be hesitant to agree to a merger between DIRECTV and its satellite rival Dish unless the deal generated more revenue than it does now, according to a Hollywood Reporter article. And that’s a ‘pretty high bar,’ Desroches added, downplaying the merger’s chances.

Speaking today to a Bank of America conference in London, the AT&T executive said his company, which owns 70 percent of DIRECTV with private equity firm, TPG, owning 30 percent, is content with how DIRECTV is performing now. AT&T spun off DIRECTV as a separate entity with TPG as a partner in 2021.

“We separated from our satellite platform, and we have it in a construct where it’s been optimized by our partners at TPG. They do a really good job in optimizing that asset” he said. “So right now, we are in a really good position with the asset. Would we look at other opportunities? We always do, that’s our job. But the bar would be pretty high in order to do something to try to accelerate more value creation.”

DIRECTV has lost at least 12 million subscribers since AT&T purchased it in 2015, but Desroches said the TV company ‘produced’ $4.5 billion last year and is expected to produce $3.5 billion this year.

“We have really good line of sight over the next several years as to what cash flows will come out of that business. And whatever we would do would have to be incrementally much better than that,” he said.

Dish Chairman Charlie Ergen has frequently said a merger between his company and DIRECTV is “inevitable.” But the New York Post reported earlier this month that his attempts to merge have stalled. The newspaper did not specifically say why the talks may have stalled, but Dish is experiencing financial issues now as it attempts to build out its national 5G wireless business.

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— Phillip Swann