AT&T Secures $5.5 Billion Loan From 12 Banks

By Noah Long ● Apr 8, 2020
  • AT&T announced it secured a $5.5 billion deal with 12 banks. These are the details.

AT&T announced it secured a $5.5 billion deal with 12 banks. And the company told investors that it has a “strong cash position, including a strong balance sheet and attractive liquidity” while navigating the economic disruption caused by the COVID-19 (novel coronavirus) pandemic.

Last month, AT&T ended up canceling a $4 billion stock buyback for the second quarter. And the company also decided to cease share repurchases in order to preserve cash. AT&T also pointed out that the COVID-19 crisis might be “material” to its financial outcome.

The $5.5 billion term-loan had Bank of America as the lead agent. The loan is also pre-payable without a penalty.

“The strength and relevance of our core subscription businesses, our continued execution on our business transformation initiatives, and sizing our operations to economic activity will provide cash from operations that will support network investments, dividend payments, and debt retirement, as well as the ability to invest in business opportunities that arise as the economies recover,” said AT&T in a statement via Variety.

AT&T plans to disclose more information about how the COVID-19 crisis is affecting its business during an earnings call scheduled for April 22 before the market opens. AT&T reported it had $12 billion in cash on hand as of December 31, 2019. And the company can also tap into a fully committed $15 billion revolving credit facility. AT&T said it has no need to use it in 2020.