AT&T Sells Two Business Units To Cerberus, Retains 47% In YP Holdings

Posted on Apr 9 2012 - 1:25pm by Editorial Staff

AT&T announced today that Cerberus Capital Management has agreed to acquire AT&T Advertising Solutions and AT&T Interactive. Over on which, AT&T will receive a 47-percent equity interest in the new entity, YP Holdings LLC. The business units generated approximately $3.3 billion in revenues in 2011. The transaction is expected to close in mid-year 2012.

“This transaction makes strategic sense for both AT&T and Advertising Solutions,” said José Gutiérrez, president and CEO of AT&T Advertising Solutions. “It enables AT&T to focus on its core strategy of leadership in wireless, IP, cloud- and application-based services. At the same time, it gives our advertising customers, partners and developers continued access to strong advertising and search innovation and performance.”

The transaction includes assets of AT&T Advertising Solutions, which delivers sales and customer support, and AT&T Interactive, which conducts interactive product development. It does not include the recently formed AT&T AdWorks, a New York-based operation that sells advertising offerings across 3-screen platforms (online, mobile and TV).

For the business units, AT&T will receive approximately $750 million in cash, subject to adjustment primarily related to timing of closing, a $200 million note and a 47-percent equity interest in YP. AT&T expects a minimal effect on 2012 earnings from the transaction.

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