News

Dish Networks and EchoStar have announced their plans to merge, bringing together their respective businesses in satellite communications, streaming services, and a nationwide 5G network. This merger marks a reunion for the two companies, as EchoStar was spun off from Dish as a standalone company in 2008.

In recent years, Dish has shifted its focus from satellite pay-TV to telecom in response to the rise of cord-cutting and increasing competition. In 2020, Dish acquired Boost, a prepaid mobile brand, and its wireless spectrum to establish itself as a fourth national carrier after the merger of Sprint and T-Mobile.

Dish’s chairman, Charles Ergen, has long been hopeful for a merger with rival DirecTV, but regulatory obstacles have prevented such a deal in the past. While the media landscape has changed, the current regulatory climate remains challenging.

The merger between Dish and EchoStar is expected to close by the end of the year and will result in cost and revenue synergies. The combined company will have its headquarters in Englewood, Colorado and will operate under various consumer and business brands, including Dish Wireless, Boost Wireless, Sling TV, Dish TV, EchoStar, Hughes, and Jupiter satellite services, HughesON managed services, and HughesNet satellite internet.

Ergen believes that this merger will enable long-term growth and the creation of a sustainable business. Dish’s previous investments in wireless spectrum and its ongoing wireless buildout, combined with EchoStar’s recent launch of Jupiter 3 satellite with available capacity for terrestrial and non-terrestrial services, are expected to significantly reduce near-term capital expenditure requirements. The combined company’s asset portfolio, enhanced free cash flow generation capability, and strengthened capital structure are anticipated to drive long-term value creation for shareholders and other stakeholders.

With Dish’s 5G wireless network covering over 70% of the U.S. and EchoStar’s Jupiter 3 satellite providing ample capacity for communication and content distribution, the merged company will be well-positioned to deliver a wide range of satellite and wireless capabilities.

Under the terms of the merger, EchoStar stockholders will receive 2.85 common shares of Dish for each share of EchoStar they hold. This represents a premium of 12.9% to EchoStar stockholders based on the closing stock prices of both companies on July 5. Upon completion of the merger, Dish Network shareholders will own approximately 69% of the combined company, while EchoStar shareholders will own the remaining 31%.

Hamid Akhavan, the CEO of EchoStar, will lead the combined company as CEO, while Erik Carlson, Dish Network’s current CEO, will step down. Charles Ergen will serve as executive chairman, and John Swieringa, COO of Dish Wireless, will assume the role of COO. The company’s 11-member board will consist of seven Dish directors, three EchoStar independent directors, and Hamid Akhavan.

The post Dish Networks and EchoStar to Merge, Creating a Combined Company with Satellite and 5G Capabilities appeared first on ISP Today.