Dish Networks and EchoStar said today the two public companies will merge, joining the satcaster, streaming services and a nationwide 5G network with a leading satellite communications business. It’s a reunion. Dish spun EchoStar out into a standalone company in 2008. Over the last several years, as cord-cutting and competition ate into satellite pay-TV business, Dish has pivoted to telecom. It acquired prepaid mobile brand Boost and its wireless spectrum in 2020 to create a fourth national carrier after Sprint merged with T-Mobile.Ergen has also continued to hold out hope for a merger with rival DirecTV. Regulators blocked a deal years ago. The media landscape has changed, but the regulatory climate is particularly tough these days.Today’s merger, which will see cost and revenue synergies, is expected to close by year end. The combined company will be headquartered in Englewood, Colorado with a suite of consumer and business brands including Dish Wireless, Boost Wireless, Sling TV and Dish TV, as well as EchoStar, the Hughes and Jupiter satellite services, HughesON managed services, and HughesNet satellite internet.“This is a strategically and financially compelling combination that is all about growth and building a long-term sustainable business,” said Charles Ergen, chairman of the board of both companies. “Dish’s substantial past investments in spectrum and its wireless buildout, combined with EchoStar’s recent launch of Jupiter 3, are expected to significantly reduce near-term capex requirements.” He said the asset portfolio of the combined company and its “enhanced free cash flow generation capability and strengthened capital structure are expected to drive long-term value creation for our shareholders and other stakeholders.”Dish’s 5G wireless network now covers more than 70 percent of the U.S. EchoStar’s Jupiter 3 satellite launched with significant available capacity for converged terrestrial and non-terrestrial services. The merged company will be well-positioned to deliver a broad set of satellite and wireless communication and content distribution capabilities.On closing, EchoStar stockholders will receive 2.85 common shares of Dish for each share of EchoStar in hand. The exchange ratio represents a premium of 12.9% to EchoStar stockholders based on the companies’ closing stock prices on July 5 – the last full trading day prior to media speculation regarding a potential transaction. Dish Network shareholders will end up with about 69% of the combined company, EchoStar shareholders with 31%.EchoStar CEO Hamid Akhavan will run the combined comapny. Dish Network’s chief executive Erik Carlson will exit when the deal closes. Ergen will be executive chairman. John Swieringa, COO of Dish Wireless, will be COO. An 11-member board will include seven Dish directors, three EchoStar independent directors and Akhavan.
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