The current financial problems surrounding AT&T’s long distance telephony business is slowing down the proposed $71.5 billion sale of its broadband business unit to Comcast Corp.
AT&T is unable to close the Comcast deal at present, due to its current bank facility. The deal could go through if after the sale, the company’s Moody’s Investor Service credit rating achieves a level of Baa1 or above. The troubled communications company has begun talks with a group of banks about the possibility of a substitute for its current $8 billion credit facility which is due to expire in December.
Comcast agreed to buy AT&T Broadband in December. The deal will see AT&T receive $51.5 billion in Comcast equity and $20 billion in cash to relieve its current debt burden. If the deal goes ahead it will create a cable company with over 22 million customers and annual revenues of over $19 billion.