AT&T, facing $158 billion debt, to sell Puerto Rico network for $2 billion

Enlarge / An AT&T sign outside a company office in New York City. (credit: Getty Images | Roberto Machado Noa )

AT&T has agreed to sell its wireless and wireline networks in Puerto Rico and the US Virgin Islands for $1.95 billion to Liberty Latin America. The deal will help AT&T pay a small portion of the debt load created in part by its acquisitions of DirecTV and Time Warner Inc.

AT&T announced the deal today, saying that the transaction requires review by the Federal Communications Commission and Department of Justice. AT&T hopes to complete the sale within six to nine months. "This transaction is a result of our ongoing strategic review of our balance sheet and assets to identify opportunities for monetization," AT&T CFO John Stephens said.

AT&T has said it intends to cut its debt by up to $20 billion in 2019. The company already lowered its long-term debt from $166 billion as of December 31, 2018 to $158 billion on June 30, 2019. AT&T told investors today to expect share buybacks later this year as the company continues improving its debt-to-earnings ratio. AT&T said it is on track to hit its goal of a net debt-to-adjusted EBITDA ratio in the 2.5X range by year end, down from its current 2.7X. AT&T's adjusted EBITDA was $29.8 billion for the first six months of 2019, a pace of nearly $60 billion for the year.