In a shocking move, EchoStar has agreed to sell its Dish TV provider and digital business Sling to rival DirecTV for a mere $1, with the latter assuming a whopping $9.75 billion in debt. The deal, announced on Monday, sent EchoStar’s shares plummeting by 10%. The acquisition is contingent on the consent of some of Dish’s bondholders and is expected to close in the fourth quarter of 2025.
The combined entity will serve nearly 20 million customers, making it a formidable player in the pay-TV market. According to EchoStar CEO Hamid Akhavan, the merger was necessary to create a company with the scale to negotiate better deals with programmers and offer more tailored packages to consumers.
Akhavan cited the decline of the content distribution industry as a whole, with traditional players like Dish and DirecTV struggling to keep up with newer platforms and technologies. He also acknowledged that EchoStar was unable to support both its video distribution and core wireless internet businesses, and that the merger would allow the company to focus on its core services.
In a separate development, AT&T announced the sale of its 70% stake in DirecTV to private equity firm TPG for $7.9 billion. The deal marks a significant shift in the pay-TV landscape, with the possibility of a Dish-DirecTV merger having been rumored for decades.
EchoStar’s financial situation had been precarious, with a $2 billion debt payment looming and limited cash reserves. The company’s failed attempt to refinance its debt had raised concerns about its ability to stay afloat. However, Akhavan expressed confidence in EchoStar’s future, citing secured capital and a focus on customer acquisition over service expansion.
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