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Bond Market News
DirecTV Downgraded to B+ on TPG Takeover; Outlook Stable
July 17, 2025
DirecTV, US based satellite pay-TV company, was downgraded to B+ from BB- by S&P. The downgrade came in after TPG Capital acquired AT&T’s remaining 70% stake, making DirecTV a full private equity portfolio company. With TPG in control, S&P forecasts leverage to rise with an increased focus to meet investment return, possibly even via debt-financed dividends.
Leverage is forecasted to reach 2.3-2.5x by the end of 2026, up from about 2x earlier this year following a $1.6bn debt-financed dividend. Free operating cash flow is expected to remain around $3bn annually through 2026, says S&P. Despite DirecTV’s shift toward streaming and sports-centric skinny bundle, S&P expects its EBITDA to downtrend and YouTube TV to continue gaining market share given their low price positioning.
DirecTV’s 5.875% 2027s were trading stable at 99.7, yielding 6.05%.
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