ENGLEWOOD, Colo., May 20, 2019 /PRNewswire/ -- EchoStar
Corporation (NASDAQ:SATS) announced today that it executed an
agreement with DISH Network Corporation (NASDAQ:DISH) to transfer
to DISH the portion of its EchoStar Satellite Services business
that manages and provides broadcast satellite services primarily to
DISH and its subsidiaries ("BSS Business"). EchoStar
shareholders will receive 22,937,188 shares of DISH Class A common
stock upon consummation of the transaction.
The BSS Business includes the business of EchoStar that manages
and provides broadcast satellite services to DISH and its
subsidiaries and DISH Mexico, S. de R.L. de C.V. It also
provides telemetry, tracking and control services to satellites
owned by DISH and a portion of EchoStar's other businesses.
The transaction will also include the products, assets, licenses
and technology, and the business operations, revenues, billings,
liabilities and operating activities, primarily related to those
businesses and certain other EchoStar real estate properties.
Mike Dugan, President and CEO of
EchoStar said. "This transaction will allow EchoStar to focus our
efforts on our high growth business of broadband services and other
initiatives, while eliminating a negative growth component of our
financial performance and the risk associated with providing
services to a solitary customer."
At closing of the transaction, each EchoStar shareholder as of
the distribution record date will receive shares in a newly created
subsidiary of EchoStar housing the BSS Business and other assets
transferring in the transaction to reflect such stockholder's pro
rata ownership of EchoStar Class A and Class B common stock in the
aggregate ("Distribution"). Immediately following the
Distribution, a subsidiary of DISH will merge with and into such
entity and each EchoStar stockholder as of the distribution record
date will receive a number of shares of DISH Class A common stock
equal to 22,937,188 divided by the total number of shares of
EchoStar Class A and Class B common stock outstanding on the
distribution record date. The distribution record date has
not yet been determined. As of May 16,
2019, the total outstanding shares of EchoStar Class A and
Class B common stock was approximately 95,719,000, which would
result in the issuance of approximately 0.24 shares of DISH Class A
common stock for each share of EchoStar Class A and Class B common
stock outstanding on that date. The final exchange ratio will be
determined on the distribution record date.
The transaction is structured in a manner intended to be
tax-free to EchoStar and its shareholders. It is expected to close
during the second half of 2019, subject to customary conditions,
including receipt of certain regulatory approvals.
EchoStar has made a presentation available for download on
EchoStar's website at http://ir.echostar.com, which includes
certain financial information about the transaction.
Deutsche Bank Securities Inc. acted as financial advisor to
EchoStar in the transaction. White & Case LLP acted as
legal counsel for EchoStar in the transaction.
About EchoStar
EchoStar Corporation (NASDAQ: SATS) is a premier global
provider of satellite communications solutions. Headquartered
in Englewood, Colo., and
conducting business around the globe, EchoStar is a pioneer in
secure communications technologies through its Hughes Network
Systems and EchoStar Satellite Services business segments.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995
This press release may contain statements that are forward
looking, as that term is defined by the Private Securities
Litigation Reform Act of 1995. These forward-looking
statements are based on management's beliefs, as well as
assumptions made by, and information currently available to,
management. When used in this release, the words "believe,"
"anticipate," "estimate," "expect," "intend," "project," "plans,"
and similar expressions and the use of future dates are intended to
identify forward looking statements. Although management
believes that the expectations reflected in these forward looking
statements are reasonable, it can give no assurance that these
expectations will prove to have been correct. The forward looking
statements may include those regarding any matter set forth in this
document or any of the exhibits incorporated herein. These forward
looking statements involve risks and uncertainties that could cause
actual results to differ materially from those predicted in any
such forward looking statements. Such factors include, but are not
limited to, the possibility that a transaction will not be
completed, failure to obtain necessary regulatory approvals or to
satisfy any of the other conditions to a potential transaction,
adverse effects on the market price of DISH's common stock, adverse
effects on the market price of EchoStar's common stock and on
EchoStar's operating results for any reason, including, without
limitation, because of a failure to complete a transaction, failure
to realize the expected benefits of a transaction, significant
transaction costs and/or unknown liabilities and general economic
and business conditions that affect EchoStar or DISH following the
transaction. You are cautioned not to place undue reliance on any
forward-looking statements, which speak only as of the date
made. These statements are subject to certain risks,
uncertainties, and assumptions. See "Risk Factors" in EchoStar's
and HSSC's Annual Reports on Form 10-K for the year ended
December 31, 2018 and Quarterly
Reports on Form 10-Q for the quarterly period ended March 31, 2019 filed with the Securities and
Exchange Commission and in the other documents EchoStar files with
the Securities and Exchange Commission from time to time. The
forward-looking statements speak only as of the date made, and
EchoStar Corporation expressly disclaims any obligation
to update these forward-looking statements.
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SOURCE EchoStar Corporation