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: 30.02 USD

Market: NYSE
Market Cap: $213.89 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...



Alpha Growth PLC using experienced team to start Alpha Growth and Income...

Alpha Growth PLC (LON: ALGW) CEO Gobind Sahney joined Steve Darling from Proactive to discuss the fund called Alpha Growth and Income fund or AGI. This funds prospective client are family offices, pension funds, and other institutions that still wish to receive some income but also want their...

12 hours, 55 minutes ago

2 min read