DirecTV to Acquire EchoStar’s Video Distribution Business

DirecTV has entered into a definitive agreement to acquire EchoStar’s video distribution business Dish, including Dish TV and Sling TV.

The combined video company is expected to have increased scale to incentivize programmers to allow DirecTV to deliver smaller packages at lower price points. It will also be better positioned to bring together multiple content sources in one easily accessible place and have an enhanced ability to make the investments required to improve its streaming services. The combination is expected to improve the viability of the satellite platform by realizing efficiencies of some shared fixed infrastructure and operating expenses.

At close, EchoStar will have reduced its total consolidated debt (excluding financing leases and other notes payable) by approximately $11.7 billion and reduced its consolidated refinancing needs through 2026 by approximately $6.7 billion (excluding financing leases and other notes payable).

“DirecTV operates in a highly competitive video distribution industry,” said Bill Morrow, CEO of DirecTV. “With greater scale, we expect a combined DirecTV and Dish will be better able to work with programmers to realize our vision for the future of TV, which is to aggregate, curate, and distribute content tailored to customers’ interests and to be better positioned to realize operating efficiencies while creating value for customers through additional investment.”

“This agreement is in the best interests of EchoStar’s customers, shareholders, bondholders, employees and partners,” said Hamid Akhavan, president and CEO of EchoStar. “With an improved financial profile, we will be better positioned to continue enhancing and deploying our nationwide 5G Open RAN wireless network. This will provide U.S. wireless consumers with more choices and help to drive innovation at a faster pace. We expect Dish and EchoStar bondholders to benefit from two companies with stronger financial profiles and more sustainable capital structures.”

“DirecTV was founded 30 years ago to give consumers greater choices than incumbent cable companies for video content, and the company’s acquisition of Dish TV and Sling TV positions it to again provide more choices and better value in an industry currently dominated by large streaming platforms,” said David Trujillo and John Flynn, partners at TPG. “Our ability to execute these transactions, alongside our proposed acquisition of AT&T’s 70 percent stake in DirecTV announced earlier today, exemplifies the unique capabilities of the TPG platform and our experienced sector-focused investment approach as we support DirecTV’s continued investment in innovating the next generation of video services that benefit consumers.”