Fitch assigns AT&T notes A

Fitch Ratings said it assigned an A rating to AT&T Inc.'s debt issue in Taiwan consisting of $1,295,000,000 of 4.7% global senior unsecured notes due 2044.

AT&T's issuer default rating is A. The issuer default rating and debt securities remain on Rating Watch Negative, where they were placed on May 19 upon the announcement of the acquisition of DirecTV. DirecTV's wholly owned indirect subsidiary, DirecTV Holdings LLC, has an issuer default rating of BBB-.

Proceeds are expected to be used for general corporate purposes.

Fitch believes AT&T's acquisition of DirecTV will improve its financial flexibility owing to DirecTV’s strong free cash flows and the significant equity component in the transaction financing. The addition of DirecTV will also strengthen AT&T's position in the evolving video landscape, offering the potential to capitalize on trends for mobile video and over-the-top (OTT) video delivery.

Other benefits include the scale brought by DirecTV’s substantially larger video subscriber base and the diversification of AT&T's revenue stream, the agency said.

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