Why Would AT&T Acquire DirecTV?

AT&T has entered into a definitive agreement to buy DirecTV in a transaction worth $67.1 billion, including DirecTV?s net debt. The telecom giant will pay $95 for each share of DirecTV comprised of $28.50 per share in cash and $66.50 per share in AT&T stock. The company through this transaction expects to achieve cost savings of more than $1.6 billion annually within three years of the transaction?s close.