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Wednesday September 18th, 2019 10:25PM

Elliott invests $3.2B in AT&T, seeks changes

By The Associated Press

NEW YORK (AP) — Activist hedge fund manager Elliott Management is making a new $3.2 billion investment in AT&T and calling for changes at the company such as selling its DirecTV and Mexican wireless operations.

The move comes as AT&T readies a streaming service following its $81 billion purchase of Time Warner. It plans to launch HBO Max in the spring of 2020 as more people cut the cord and move to streaming services.

But Elliott said AT&T has yet to come up with a "clear and strategic rationale" as to why it needs to own Time Warner. A federal appeals court cleared the deal in February.

On Twitter, President Donald Trump called the disclosure of an activist investor "great news" for AT&T, which owns news channel CNN, long a target for Trump's tweets. He again criticized the network's news coverage on Twitter and also went after MSNBC, owned by Comcast.

AT&T stock jumped more than 4% to $37.74 in Monday morning trading.

Elliott sent a letter to AT&T's board saying it should look into divesting noncore assets like DirecTV and its Mexican wireless operations. Elliott said it has identified opportunities for more than $10 billion in savings, but that its plan represents $5 billion in cost cuts.

The investor also suggests separating the CEO and chairman positions at the Dallas company.

  • Associated Categories: Associated Press (AP), AP Business, AP Business - Corporate News, AP Business - Industries, AP Business - Financial Services, AP Technology News
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