Dish Network Corp and EchoStar Corp SATS, led by Charlie Ergen, have finalized their merger, effectively reuniting Ergen’s satellite businesses.
To finalize the acquisition, a subsidiary wholly owned by EchoStar merged with Dish Network, with Dish continuing as a subsidiary under EchoStar’s complete ownership.
Following the merger, as previously declared, every share of Dish Network’s Class A and Class C common stock was exchanged for 0.350877 shares of EchoStar’s Class A common stock.
Similarly, each share of Dish Network’s Class B common stock converted into 0.350877 shares of EchoStar’s Class B common stock.
The union, completed on December 31, is a strategic move for Dish to shift focus from its declining pay-TV business to wireless services, thereby competing with major players like Verizon Communications Inc VZ, T-Mobile US, Inc TMUS, and AT&T Inc T.
This consolidation gives Dish enhanced financial capabilities, allowing for further development of its 5G network, mobile services, and broadband offerings, including fixed home wireless and the affordable Boost Infinite mobile service, Bloomberg reports.
Ergen, 70, the co-founder and chairman of both entities, will serve as the executive chairman of the merged company. Hamid Akhavan, 62, has been the leader of EchoStar since March 2022 and has been appointed as the president and CEO of the unified companies since November.
Dish has been grappling with a $24.6 billion debt and a significant decline in TV subscribers, dropping to 8.8 million in Q3 from 14 million a decade ago.
The merger provides Dish with much-needed financial relief, including access to EchoStar’s cash reserves and free cash flow, essential for its ambitious network and service expansions.
The all-stock deal, announced in August, integrates Dish into EchoStar’s satellite network operations. EchoStar, known for satellite communications through Hughes Network Systems and EchoStar Satellite Services, was initially part of Dish before spinning off in 2008.
The Federal Communications Commission approved the deal with minimal scrutiny, citing no substantial change in ownership or control due to Ergen’s leadership in both companies.
Price Action: SATS shares traded lower by 2.41% at $16.77 premarket on the last check Tuesday.
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