viewAT&T Inc.

AT&T jumps after activist investor announces $3.2B stake, pens open letter calling for restructuring

Elliot Management Corp predicted shares could reach $60 by the end of 2021 under its "Activating AT&T" plan

AT&T Inc building
In the letter, the firm pointed to a series of past strategic setbacks, headlined by its $109 billion acquisition of Time Warner in 2018

Shares of AT&T Inc (NYSE:T) surged Monday morning after activist investment firm Elliot Management Corporation announced a $3.2 billion stake in the company and publicly called for a restructuring, according to media reports. 

In a letter to the telecommunication giant’s board, the Paul Singer-led firm expressed the belief that the company’s share price could reach $60 by the end of 2021.

Investors have already started pushing it in that direction, boosting the share price as high as $38.14 on Monday before cooling slightly to end the day up 1.5% at $36.79.

“The purpose of today’s letter is to share our thoughts on how AT&T can improve its business and realize a historic increase in value for its shareholders,” Elliot said.

READ: WeWork owner's IPO valuation could fall below $20BN, while some investors are pushing it to shelve planned offering: media reports

The firm pointed to a series of past strategic setbacks, headlined by its $109 billion acquisition of Time Warner in 2018. 

“AT&T has yet to articulate a clear strategic rationale for why AT&T needs to own Time Warner,” the letter said. “While it is too soon to tell whether AT&T can create value with Time Warner, we remain cautious on the benefits of this combination.

That said, the firm argued in the letter that AT&T is trading at a discount. Its proposed plan, known as Activating AT&T, outlined a path to unlock latent value and deliver on growth. 

The plan is composed of four tenets: improving strategic focus, formatting its capital allocation framework, improving operations and enhancing leadership and oversight.

“By divesting non-core assets; reducing operational inefficiency; instituting capital discipline and aggressively de-levering; and enhancing leadership and oversight, AT&T can improve its business and deliver historic value creation for all stakeholders,” Elliot said.

—Updated to include closing price—

Contact Andrew Kessel at [email protected] 

Follow him on Twitter @andrew_kessel

Quick facts: AT&T Inc.

Price: 30.99 USD

Market: NYSE
Market Cap: $220.8 billion

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events


The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...



Redx Pharma PLC's Lisa Anson updates on lead asset RXC004 and increased...

Redx Pharma PLC's (LON:REDX) Lisa Anson recaps on its lead product RXC004 which is in a Phase I clinical trial and is part of a potentially breakthrough group of cancer drugs called Porcupine inhibitors. Anson also details the recent investment by its majority shareholder Redmile which has...

13 hours, 54 minutes ago

2 min read