AT&T is looking to dissolve its cybersecurity division

It has been reported that AT&T Inc, the second largest U.S. wireless carrier, has been considering selling its cybersecurity unit, undermining the acquisition it made five years ago. Those with knowledge of the development said AT&T Inc is exploring possible sales of the division.

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After spending $108.7 billion in 2018 on Time Warner Inc, AT&T decided to sell the business in order to reduce its $108.7 billion debt. After the deal was unwound, AT&T sold this cybersecurity business as part of a series of divestitures in order to pay down its debt.

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There has been an increase in AT&T's stock price due to the sale of 30% of its pay TV unit DirecTV to private equity firm TPG for $1.8 billion in two years time. In addition, at the end of that period, AT&T received $40.4 billion in cash as a result of spinning off and combining its Warner Media business with Discovery Communications.

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As reported by sources close to the company, AT&T has been working in conjunction with Barclays Plc in hopes of finding a buyer for its cybersecurity business, Alienvault, which was acquired for roughly $600 million by AT&T in 2018 when it was known as Alienvault. There is no way of knowing how much the business might be able to fetch now that it is up for sale.

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There is no certainty about the deal, and the sources requested anonymity due to the confidential nature of the matter. Neither AT&T nor Barclays responded to our request for comment.

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In AT&T's cybersecurity division, laptops, desktops, servers, and mobile devices are protected in order to keep small and medium businesses running smoothly.

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As cybersecurity startups that offer cheap alternatives mushroom, AT&T's rationale has eroded as Alienvault's acquisition gives AT&T an edge in attracting and retaining corporate clients.

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The company is aiming to further reduce its net debt, which was $132.2 billion at the end of December, to about $100 billion by 2025.

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The credit ratings agency Moody's Investors Service Inc said on Tuesday that AT&T's ability to pay out dividends and invest in fiber and 5G wireless technology is determined by the ability to pay down debt.