EchoStar to unload Dish to DirecTV for $1

EchoStar agreed a deal to sell its struggling satellite video distribution division for $1 to DirecTV as part of a series of transactions designed to pay off some of its debt and further invest in its 5G network.

The long-rumoured merger between the two satellite video companies includes DirecTV acquiring the Sling TV streaming division and the Dish TV satellite business.

DirecTV will assume about $9.7 billion of Dish’s net debt in a deal that is expected to close in Q4 2025.

The two companies are proposing an exchange offer at a discounted rate for the debt to help extend the maturities.

EchoStar stated the sale of its video business combined with $2.5 billion in new financing from investment company TPG Angelo Gordon will provide the cash needed to pay off about $2 billion in debt maturity by November and “provide interim liquidity”.

MoffettNathanson senior MD Craig Moffett previously predicted EchoStar-owned Dish Network could go bankrupt by the end of 2024.

Roger Entner, founder and analyst at Recon Analytics, stated on X the arrangement pulls EchoStar’s head out of a noose while giving it a few more years of runway.

The proposed deal is projected to cut EchoStar’s total consolidated debt by $11.7 billion and decrease its refinancing needs by approximately $6.7 billion through to 2026.

Along with the DirecTV transaction, EchoStar announced it will issue $5.1 billion of new senior secured notes maturing in 2029 from existing stakeholders to build out its  Boost Mobile nationwide 5G open RAN network

“Today’s strategic actions will advance our ability to aggressively compete in the US wireless market,” stated Hamid Akhavan, president and CEO of EchoStar.

AT&T to offload DirecTV
In a separate deal, AT&T reached an agreement with TPG Capital to sell its remaining stake in DirecTV by the second half of 2025. The operator expects to generate $7.6 billion through cash payments from TPG Capital for its 70 per cent stake in DirecTV. TPG Capital currently owns the remaining 30 per cent.  

In 2021, AT&T spun off its DirecTV, AT&T TV and U-verse video services into a separate entity co-owned by TPG Capital but increased competition from streaming services such as Hulu, Netflix and Amazon’s Prime Video led to a loss of subscribers over the years.  

AT&T stated the sale allows  it “to focus on being the leading wireless 5G and fibre connectivity company in America”.