It’s always good when two independent companies find each other. DirecTV has reached an agreement to acquire Dish Network, . This will create a global behemoth in the satellite TV space.
And it will provide financial ammunition for the struggling Dish Network. The company has billions of dollars in debt because, well, satellite TV is no longer a growth industry. Stream, baby, stream. In all, Dish has $2 billion in debt due in November and only $500 million in cash on hand. Those numbers don’t add up.
The details of the agreement are very confusing. It is a multi-step activity with several players. First, private equity firm TPG will acquire a majority stake in DirectTV from AT&T for $7.6 billion. Next, DirecTV will buy Dish Network for just one dollar. However, it will also take on $2 billion in debt. EchoStar, which is Dish’s parent company, will hold on to other parts of the business as part of the deal, including more than $30 billion in wireless spectrum investments. DirecTV will acquire Sling TV’s video service as part of the deal.
The acquisition will create the largest provider of pay TV, with a total of approximately 19 million subscribers. As a counterpoint, cable TV leader Comcast . Netflix steps in, to show the big difference between pay TV and streaming.
The companies say they expect the deal to close in the second half of 2025, although the whole thing is subject to regulatory approval. The Justice Department has rejected similar mergers, but that’s where the satellite TV industry was at its peak.
Recently, the federal government put aside a potential merger on the grounds that it would deprive rural customers of a viable alternative to Dish and DirecTV when looking to purchase 5G wireless service.