Eric M. Krautheimer

Krautheimer specializes in mergers and acquisitions as well as private equity deals for companies in the media and telecommunications, health care and life sciences, insurance and consumer and retail sectors.

Krautheimer has represented long-time S&C client AT&T Inc. over the entire course of his career, including in its 2018 $108.7 billion Time Warner purchase. Since then, deals resulting from that transaction have been a major part of his book of business.

In his most recent transaction, he’s leading AT&T in its spin-off of WarnerMedia LLC in the entertainment conglomerate’s merger with Discovery Inc. to create a new standalone entertainment company. The deal, announced in May 2021, allows AT&T to combine its subsidiary with Discovery in an arrangement known as a reverse Morris trust. AT&T will receive $43 billion in a combination of cash, debt securities and WarnerMedia’s retention of certain debt. AT&T’s shareholders will receive stock representing 71 percent of the new company; Discovery shareholders will own 29 percent.

“WarnerMedia becomes a public company, then merges with Discovery. The advantage is that the Discovery shares are not taxable,” Krautheimer said.

He is also leading AT&T in its agreement with private equity platform TPG Capital to establish New DirecTV in a $16.25 billion transaction. Announced in February 2021, the new entity will own and operate AT&T’s U.S. video business unit to include DirecTV, AT&T TV and U-verse video services. The transaction is expected to close in the second half of 2021, when AT&T expects to receive $7.8 billion from New DirecTV.

In another transaction, Krautheimer led AT&T—as the largest shareholder of Central European Media Enterprises Ltd.—in the $2.1 billion acquisition of CME by PPF Group N.V., a Czech Republic private equity concern. CME operates 30 television channels that reach 45 million viewers in Bulgaria, Czech Republic, Romania, Slovakia and Slovenia. AT&T owned, through subsidiaries, 75 percent of the economic interests of CME. The deal, announced in late 2019, was said to be part of AT&T’s larger campaign to dispose of non-core assets and pay down its debt.

And Krautheimer in 2019 led AT&T in its agreement with Hulu to sell back its minority stake in the streaming video joint venture in a transaction that valued Hulu at $15 billion, with AT&T’s 9.5 percent interest valued at $1.43 billion.

“Both the TGP and WarnerMedia transactions are the kind of highly structured and complicated deals we live to work on,” Krautheimer said.

- John Roemer