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Market Turmoil: AT&T, Microsoft, and KKR Face Challenges

Strategic Insights

— 2 min read

AT&T, Inc. has extended the end date for its merger with DirecTV for a short period to facilitate regulatory authorization, while Microsoft has decided to end its display ad business, laying off 1,200 employees. Meanwhile, KKR & Co. L.P. has faced a settlement with the SEC over misallocated funds, paying $30M to settle charges. These developments highlight the ongoing challenges facing these companies in the rapidly changing advertising and private equity industries.

Key Takeaways:

  • AT&T has extended the end date for its merger with DirecTV for a short period, aiming to facilitate regulatory authorization.
  • Microsoft has decided to end its display ad business, laying off 1,200 employees as the company seeks to "make some tough choices" in areas where things are not working.
  • KKR & Co. L.P. has agreed to pay $30M to settle charges with the SEC over misallocated funds, comprising a $10M penalty.
  • The SEC has been scrutinizing the private equity industry to ensure that fund managers are not misallocating or unfairly charging fees and costs to investors.
  • Twitter, Yelp, LinkedIn, Zillow, and others have reported seeing challenges in display ad sales, largely due to industry adoption of programmatic ad-buying platforms.
  • The SEC examination found that KKR incurred $338M in broken deal or diligence expenses related to unsuccessful buyout opportunities and related costs over a six-year period ending in 2011.
  • Integrated Silicon Solution, Inc. has announced that its stockholders have permitted the takeover of ISSI by Uphill Investment Co. for $23 per share in cash.

Statistics:

  • AT&T, Inc. closed at $35.77, a drop of -0.97% with session volume of 28.63 Million.
  • KKR & Co. L.P. shares collapsed -1.30% in the previous trading session, with the company opening its session at $22.85 and outstanding shares of 824.21.
  • The company held a price-to-earnings ratio of 18.99.
  • Integrated Silicon Solution, Inc. closed at $22.16, a move down of -0.31% in the last trading session.
  • ISSI has annual sales growth for the past five years of 16.30%.
  • The past 12 months price-to-sales ratio recorded was 2.13, and the price-to-cash ratio remained 6.05.

Sources:

  • AT&T, Inc. 8-K filing
  • Bloomberg reports on Microsoft's display ad business
  • SEC Enforcement Division's Asset Management Unit's investigation into KKR & Co. L.P.
  • Integrated Silicon Solution, Inc. announcement on takeover by Uphill Investment Co.
  • Syndigate Media Inc. (Syndigate.info) for the 2015 Global Data Point.

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