DirecTV is threatening to walk away from an acquisition of rival Dish Network for $1 and $9.75 billion in debt on Nov. 22 if the latter satellite TV giant’s bondholders don’t agree to a debt exchange.
“A successful exchange was a condition for acquiring the Dish video business,” a DirecTV spokesperson told TheWrap. “Given the outcome of the EchoStar exchange, DirecTV will have no choice but to terminate the acquisition of Dish by midnight on Nov. 22.”
The threat comes after Bloomberg reported that a group of Dish’s bondholders rejected a revised offer put forward by DirecTV at the end of October, which would’ve lowered the minimum loss on $8.9 billion of bonds by $70 million to $1.5 billion. The deadline to accept the offer was extended to 5 p.m. ET on Tuesday.
During EchoStar’s third quarter 2024 earnings call on Tuesday, CEO Hamid Akhavan told analysts that Dish would have a path forward whether the transaction closes or not. The deal is expected to close by the fourth quarter of 2025.
EchoStar spokesperson Ted Wietecha told TheWrap on Wednesday that the company has a “more robust foundation to operate and grow EchoStar’s business, independent of the exchange outcome.”
As part of the deal, DirecTV, private equity firm TPG Angelo Gordon and certain co-investors provided $2.5 billion in financing to allow Dish to meet its debt maturity in November. The company also raised an additional $5.6 billion in financing as part of a series of recently announced transactions, which Wietecha said are “unaffected” by the DirecTV deal.
If the Dish-DirecTV merger goes through, the combined company will be fully controlled by TPG, which will acquire AT&T’s remaining 70% stake in DirecTV in a separate deal expected to close in the first half of 2025. The sale of AT&T’s stake is not contingent on the closing of the Dish-DirecTV merger.
