DIRECTV announced plans to acquire DISH, EchoStar’s video distribution business, through a debt exchange transaction. The deal aims to create a stronger competitor in the video industry, which streaming services from tech giants and programmers currently dominate. This move comes as DIRECTV and DISH have collectively lost 63% of their satellite customers since 2016, with traditional pay TV penetration in U.S. households now below 50%.
The acquisition includes both DISH TV and Sling TV services. DIRECTV expects to achieve cost synergies of at least $1 billion per year by the third anniversary of closing, assuming a late 2025 completion. The combined company will operate under the DIRECTV name and maintain its headquarters in El Segundo, California, with Bill Morrow continuing as CEO.
Alongside this deal, TPG Inc. revealed plans to acquire AT&T’s 70% stake in DIRECTV, consolidating ownership of the company. This separate transaction is expected to close in the second half of 2025. The DISH acquisition aims to benefit both companies financially, with DIRECTV targeting a leverage position just over 2.0x at close and plans to reduce it to under 2.0x within 12 months.
Key points of the deal include:
- DIRECTV will acquire DISH for a nominal $1 plus assumption of DISH DBS net debt
- The transaction involves an exchange offer for approximately $9.75 billion of DISH DBS notes
- EchoStar will reduce its total consolidated debt by about $11.7 billion
- The deal will allow EchoStar to focus on enhancing its 5G Open RAN wireless network
- Regulatory approvals and successful closing of the exchange offer are required
Bill Morrow, CEO of DIRECTV, stated: “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.”
For its part, EchoStar said the deal advances its mission of deploying a nationwide facilities-based wireless service to compete with dominant incumbent wireless carriers and its ability to further leverage its satellite assets and experience, including developing innovative direct-to-device (D2D) solutions.
EchoStar plans on further deploying its nationwide 5G Open RAN wireless network, which will provide more choices and better service to consumers under the Boost Mobile brand, while driving innovation at a faster pace.
“Today’s strategic actions will advance our ability to aggressively compete in the U.S. wireless market. Customers of legacy incumbents will be waking up and paying attention to our state-of-the-art network,” said Hamid Akhavan, President and Chief Executive Officer, EchoStar. “With an improved financial profile and a unique approach, we expect to gain share, drive shareholder value, and provide more options for U.S. wireless consumers. Our collaboration with our existing stakeholders to achieve this holistic recapitalization solution at EchoStar is a testament to their continued support of our vision, and we greatly appreciate their partnership and continued investment in our mission.”
