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EchoStar Corporation and Dish Network have announced a merger with the goal of combining satellite and terrestrial technologies in order to gain an advantage in the 5G ecosystem. The merger will allow for the integration of Dish spectrum with EchoStar’s technological capabilities, resulting in the ability to amplify 5G private networks. Charlie Ergen, founder of both companies, highlighted the opportunity to combine satellite and terrestrial communications within a 5G cloud-native platform.

Under the terms of the deal, EchoStar shareholders will receive 2.85 shares of Dish Network stock for each share of EchoStar stock, with Dish shareholders owning approximately 69% of the merged company and EchoStar shareholders owning approximately 31%. The transaction is expected to close in the fourth quarter of the year. EchoStar CEO Hamid Akhavan will become the president and CEO of the combined company, while Charles Ergen will assume the role of executive chairman. The headquarters of the combined company will be located in Englewood, Colorado, while maintaining a presence in Maryland through Hughes Network Systems.

The combined company will encompass a range of customer brands, including Dish Wireless, Boost Wireless, Sling TV, DISH TV, EchoStar, Hughes, and Jupiter satellite services, as well as HughesON managed services and HughesNet satellite internet. The merger also presents opportunities for cost and revenue synergies. The companies anticipate million in operational and capital expenditure synergies, 75% of which can be achieved within the next two years. Additionally, the combined company aims to target 5 million in revenue synergies by 2027, resulting in an incremental million in EBITDA. These synergies will be achieved through the development of a combined 5G satellite broadband private network, expanded government services, and leveraging EchoStar’s enterprise relationships.

Looking ahead, the companies also see potential value in consolidating S-band spectrum holdings for direct-to-device services. Dish holds North American S-band spectrum, while EchoStar has international S-band spectrum. This presents an opportunity to collaborate on satellite direct-to-device services with modem and handset manufacturers, as well as operators. Ergen expressed optimism about the unique position the combined company would have in this regard.

In summary, the merger between Dish Network and EchoStar aims to capitalize on the convergence of satellite and terrestrial technologies in the development of a 5G Open RAN network. The combined company will benefit from the integration of Dish spectrum and EchoStar’s technological capabilities, and seek to achieve synergies in operational costs and revenue growth.

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