Telecom mogul Charlie Ergen‘s empire is reunited again, with an all-stock merger of satellite TV and streaming service provider Dish Network with broadband and communications provider EchoStar Corp. now having closed.
EchoStar CEO Hamid Akhavan will serve as president and CEO of the combined company, known as EchoStar, with Ergen, who has controlled both companies, serving as executive chairman.
John Swieringa, president and COO of Dish Wireless, serves as president, technology and chief operating officer of the combined firm. Erik Carlson, who served as president and CEO of Dish Network until the closing of the transaction, previously said he would depart the business once the deal closes.
Following the close, Dish Network shareholders own approximately 69 percent, and existing EchoStar Corporation shareholders own approximately 31 percent of the common stock of the combined company.
“The completion of this merger marks an important milestone for our company and our customers, launching a new era of connectivity,” said Ergen. “We have brought together two trailblazing companies with complementary portfolios to create a global connectivity leader with premier wireless, satellite, and video distribution capabilities. Together, EchoStar and Dish offer an enhanced consumer connectivity business and an unmatched enterprise managed services business. In a world that is increasingly wireless, we are well-positioned to drive revenue and profitable growth.”
The transaction, unveiled in August, was negotiated and recommended by special committees of independent directors of both companies and unanimously approved by both boards of directors.
The combination is designed to help Dish in a difficult pay TV landscape, which has been hit by years of cord-cutting and disputes between content companies and distributors.
Dish’s total pay TV users, including subscribers of streaming service Sling TV, amounted to 8.84 million as of the end of September, compared with nearly 10.02 million as of September 2022. The company’s user base peaked in 2009 at more than 14 million subscribers.
The Ergen empire split into two companies at the start of 2008. While a smaller business than Dish, EchoStar has better margins, and its existing telecom business is seen as boosting the company tries to pivot toward becoming a wireless provider.
“This merger brings us one step closer to our goal of offering ubiquitous connectivity to people, enterprises and things, everywhere,” said Akhavan. “Together we’re better positioned to realize the connected future by leveraging every type of transport, combined with smart, enabling technologies and fully integrated services. Our superior portfolio of technology, spectrum, engineering, manufacturing and network management expertise will deliver the unparalleled connectivity solutions that customers demand.”
Dish reported 2022 revenue of nearly $4 billion with net income of $223 million, while EchoStar posted revenue of $2 billion and net income of $167 million.
“This is a strategically and financially compelling combination that is all about growth and building a long-term sustainable business,” Ergen had vowed in August. “The transaction is expected to generate significant cost and revenue synergies, and the strong asset portfolio of the combined company paired with its enhanced free cash flow generation capability and strengthened capital structure, are expected to drive long-term value creation for our shareholders and other stakeholders.”
