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AT&T Looking to Sell WB Games in Possible $4 Billion Deal

AT&T, looking to reduce its $165 billion debt, is discussing the sale of WB Games in a $4 billion deal, a media report says.
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AT&T  (T)  is reportedly considering a sale of its Warner Bros. gaming business in a possible $4 billion deal.

Shares of the Dallas company at last check were off slightly Monday to $30.36. 

The unit, Warner Bros. Interactive Entertainment, or WB Games, is known for publishing the "Batman: Arkham" series, "Middle-Earth: Shadow of Mordor," many "LEGO" and "Harry Potter" games, "Mortal Kombat," and "The Witcher 3: Wild Hunt."

The deal could be valued at $4 billion and have a licensing component that would still generate revenue from the intellectual property.

AT&T is looking to reduce its $165 billion debt, according to CNBC. Potential buyers include Take-Two Interactive Software  (TTWO) , Activision Blizzard  (ATVI)  and Electronic Arts  (EA)

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An AT&T spokeswoman declined to comment on the reports. 

AT&T acquired the gaming business as part of the 2018 buyout of Time Warner assets. This deal and the 2014 acquisition of DirecTV increased AT&T’s debt and the company has been looking to ways to cut costs and unload assets. 

Like other media companies, AT&T is losing revenue as television advertisers pull back on deals with broadcast and cable outlets as the coronavirus continues to hit the U.S. economy hard.

In April, AT&T posted modestly weaker-than-expected expected first-quarter earnings and pulled its full-year profit guidance, as the global coronavirus pandemic clipped its bottom line. 

In March, the company said it was withdrawing from an agreement with Morgan Stanley & Co.  (MS)  to repurchase $4 billion of stock during the second quarter due to the coronavirus outbreak.