DirecTV pulls plug on Dish merger
November 22, 2024
By Chris Forrester

The planned merger between two US pay-TV satellite broadcasters is definitely off – at least for the moment. A deadline set by DirecTV passed without fresh discussions or progress happening.
The blame for the decision falls on Charlie Ergen’s Dish/EchoStar and its bond (debt) holders. Under the complex merger deal, which would have created the largest US pay-TV distributor with more than 19 million subscribers, DirecTV agreed to pay EchoStar $1, plus the assumption of Dish’s debt of some $9.75 billion (€9.3bn).
“While we believed a combination of DirecTV and Dish would have benefitted all stakeholders, we have terminated the transaction because the proposed Exchange Terms were necessary to protect DirecTV’s balance sheet and our operational flexibility,” said DirecTV CEO Bill Morrow. “DirecTV will advance our mission to aggregate, curate and distribute content tailored to customers’ interests by pursuing innovative products and providing customers with additional choice, flexibility and control. We are well positioned for the future with a strong balance sheet and support from our long-term partner TPG.”
The on/off merger scheme had been talked about for some 20 years but had been rejected by regulators. Now, with competition from the many streaming services available, the merger was likely to have been approved by regulators.
However, the Dish bondholders would have had to accept a $1.5 billion ‘haircut’ to their debt as a key element of the merger plan. With a very large debt burden and obligatory repayments looming, EchoStar has been trying to negotiate with lenders in order to stave off a potential bankruptcy.
It is understood that the TPG (the former Texas Pacific Group) move to buy the remaining portion of DirecTV would still go ahead.