Creates a Global Connectivity Leader with
Premier Wireless, Satellite and Video Distribution
Capabilities
Expected to Generate Significant Cost and
Revenue Synergies
Strong Asset Base and Enhanced Free Cash Flow
Generation Position Combined Company for Growth and Value
Creation
LITTLETON and ENGLEWOOD, Colo., Aug. 8, 2023
/PRNewswire/ -- DISH Network Corporation (Nasdaq: DISH) and
EchoStar Corporation (Nasdaq: SATS) today announced they have
entered into a definitive agreement for DISH Network to combine
with EchoStar Corporation in an all-stock merger at a fixed
exchange ratio. The transaction was negotiated and recommended by
Special Committees of Independent Directors of both companies and
unanimously approved by the Boards of Directors of both
companies.
Upon closing of the transaction, EchoStar Corporation
stockholders will receive 2.85 shares of DISH Network Class A
common stock for each share of EchoStar Corporation Class A, Class
C or Class D common stock and 2.85 shares of DISH Network Class B
common stock for each share of EchoStar Corporation Class B common
stock they own. The exchange ratio represents a premium of 12.9% to
EchoStar stockholders as implied by the unaffected 30-day volume
weighted average closing stock prices of the two companies on
July 5, 2023, the last full trading
day prior to media speculation regarding a potential
transaction.
The transaction combines DISH Network's satellite technology,
streaming services and nationwide 5G network with EchoStar's
premier satellite communications solutions, creating a global
leader in terrestrial and non-terrestrial wireless connectivity.
Both companies have strong momentum, highlighted by DISH's 5G
wireless network that now covers more than 70 percent of the U.S.
with full commercialization underway and the successful launch of
EchoStar's JUPITER 3 satellite with significant available capacity
for converged terrestrial and non-terrestrial services. The
combined company will be well-positioned to deliver a broad set of
communication and content distribution capabilities, accelerating
the delivery of satellite and wireless connectivity solutions
desired by customers.
"This is a strategically and financially compelling combination
that is all about growth and building a long-term sustainable
business," said Charles Ergen,
Chairman of the Board of both DISH Network and EchoStar. "DISH's
substantial past investments in spectrum and its wireless buildout,
combined with EchoStar's recent launch of JUPITER 3, are expected
to significantly reduce near-term CAPEX requirements. 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."
"From unconnected individuals in the most rural and remote
regions of the world to the constantly evolving networks of private
enterprises and government institutions, the connectivity landscape
is rapidly changing," said Hamid
Akhavan, President and Chief Executive Officer of EchoStar.
"As a combined company, we will offer a broad suite of robust
connectivity services, using a superior portfolio of technology,
spectrum, engineering, manufacturing and network management
expertise. DISH shares our customer-first culture, and together we
will be well positioned to further scale and accelerate our
strategy."
"The combination of DISH and EchoStar brings together two
trailblazers with complementary portfolios and a shared commitment
to change the way the world communicates," said Erik Carlson, President and Chief Executive
Officer, DISH Network. "DISH is transforming America's wireless
infrastructure with its 5G technology. With EchoStar's engineering
capabilities, managed network services delivery and worldwide
S-band spectrum rights, the combined company will have greater
resources and the financial flexibility to deliver connectivity to
consumers, enterprises and governments around the world."
The combined company will be headquartered in Englewood, Colorado. It will go to market
worldwide under a suite of proven consumer and business brands,
including DISH Wireless, Boost Wireless, Sling TV and DISH TV, as
well as EchoStar, Hughes® and JUPITER™ satellite services,
HughesON™ managed services and HughesNet® satellite internet.
Transaction Terms
Hamid Akhavan will serve as
President and Chief Executive Officer of the combined company upon
closing of the transaction and Charles
Ergen will serve as Executive Chairman. John Swieringa, President & COO of DISH
Wireless, will be President, Technology & Chief Operating
Officer of the combined company. Erik
Carlson will continue to serve as President and Chief
Executive Officer of DISH Network until closing of the transaction,
at which time he will depart the business.
The Board of Directors will consist of 11 members: Seven DISH
directors, three EchoStar independent directors, and Hamid Akhavan.
Following completion of the merger, existing DISH Network
shareholders will own approximately 69% and existing EchoStar
Corporation shareholders will own approximately 31% of the common
stock of the combined company. The majority shareholder group has
agreed generally not to vote DISH Class A shares owned by the
majority shareholder group upon closing of the merger for three
years, the intention of which is to ensure that, as a result of the
merger, the group's voting power in DISH Network will not increase
relative to current levels at DISH.
The transaction is subject to approval by a majority of the
combined voting power of the outstanding shares of EchoStar
Corporation common stock. DISH Network's issuance of its common
stock in the transaction is subject to approval by a majority of
the combined voting power of the votes cast by holders of DISH
Network common stock. The majority shareholder group, which
currently has approximately 90% and 93% of the combined voting
power of DISH Network and EchoStar Corporation, respectively, has
approved adoption of the merger agreement and the issuance of DISH
Network common stock required for the transaction via written
consent. No further action by DISH Network or EchoStar Corporation
stockholders is required to approve the transaction.
The transaction, which is also subject to regulatory approvals
and customary closing conditions, is expected to be completed by
year-end.
Webcast Presentation
The companies will host a webcast presentation to discuss the
transaction today at 11:00 a.m. ET
during EchoStar's previously scheduled second quarter earnings
call. The webcast will be live in listen-only mode on DISH's
investor relations website at DISH Investor Relations and
EchoStar's investor relations website at EchoStar Investor
Relations. To participate via telephone and ask a question,
participants must register using this online form.
Advisors
Evercore is serving as exclusive financial advisor, and Cravath,
Swaine & Moore LLP is serving as legal counsel to the Special
Committee of the Board of Directors of EchoStar Corporation. White
& Case LLP is serving as legal counsel to EchoStar
Corporation.
J.P. Morgan is serving as exclusive financial advisor, and
Wachtell, Lipton, Rosen & Katz is serving as legal counsel to
the Special Committee of the Board of Directors of DISH Network.
Sullivan & Cromwell LLP is serving as legal counsel to DISH
Network.
EchoStar Media
Contacts
|
Sharyn
Nerenberg
|
George Sard/Robin
Weinberg/Danya Al-Qattan
|
EchoStar
|
FGS Global
|
(301)
428-7124
|
(212)
687-8080
|
Sharyn.Nerenberg@EchoStar.com
|
echostar@fgsglobal.com
|
|
|
DISH Media
Contact
|
|
news@dish.com
|
|
|
|
About DISH Network Corporation
DISH Network Corporation is a connectivity company. Since 1980,
it has served as a disruptive force, driving innovation and value
on behalf of consumers. Through its subsidiaries, the company
provides television entertainment and award-winning technology to
millions of customers with its satellite DISH TV and streaming
SLING TV services. In 2020, the company became a nationwide U.S.
wireless carrier through the acquisition of Boost Mobile. DISH
continues to innovate in wireless, building the nation's first
virtualized, O-RAN 5G broadband network. DISH Network Corporation
(NASDAQ: DISH) is a Fortune 200 company.
About EchoStar
EchoStar Corporation (Nasdaq: SATS) is a premier
technology and networking services provider offering consumer,
enterprise, operator and government solutions worldwide under its
Hughes®, HughesNet® and EchoStar® brands. In Europe, EchoStar operates under its EchoStar
Mobile Limited subsidiary and in Australia, the company operates as EchoStar
Global Australia. For more information, visit www.echostar.com
and follow EchoStar on X (Twitter) and LinkedIn.
Forward-Looking Statements
This document contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
the accuracy of which are necessarily subject to risks,
uncertainties, and assumptions as to future events that may not
prove to be accurate. These statements are neither promises nor
guarantees, but are subject to a variety of risks and
uncertainties, many of which are beyond DISH Network's and EchoStar
Corporation's control, which could cause actual results to differ
materially from those contemplated in these forward-looking
statements. Existing and prospective investors are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date hereof. Factors that could cause actual
results to differ materially from those expressed or implied
include the factors discussed under the section entitled "Risk
Factors" of DISH Network's Annual Report on Form 10-K for the
fiscal year ended December 31, 2022,
filed with the Securities and Exchange Commission ("SEC"), and
under the section entitled "Risk Factors" of EchoStar Corporation's
Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC. DISH
Network and EchoStar Corporation undertake no obligation to update
or supplement any forward-looking statement, whether as a result of
new information, future developments or otherwise, except as
required by law. These factors include, without limitation: the
occurrence of any event, change or other circumstance that could
give rise to the termination of the merger agreement between DISH
Network and EchoStar Corporation; the effect of the announcement of
the proposed transaction on the ability of DISH Network and
EchoStar Corporation to operate their respective businesses and
retain and hire key personnel and to maintain favorable business
relationships; the timing of the proposed transaction; the ability
to satisfy closing conditions to the completion of the proposed
transaction; DISH Network's and EchoStar Corporation's ability to
achieve the anticipated benefits from the proposed transaction;
other risks related to the completion of the proposed transaction
and actions related thereto; risk factors related to the current
economic environment; significant transaction costs and/or unknown
liabilities; risk factors related to pandemics or other health
crises; risk factors related to funding strategies and capital
structure; and risk factors related to the market price for DISH
Network's and EchoStar Corporation's respective common stock.
These risks, as well as other risks related to the proposed
transaction, will be included in the registration statement on Form
S-4 that will include as a prospectus a joint information statement
of the type contemplated by Rule 14c-2 of the Securities Exchange
of 1934, as amended (the "Exchange Act"), and be filed with the SEC
in connection with the proposed transaction. While the list of
factors presented here is, and the list of factors to be presented
in the registration statement on Form S-4 and the joint information
statement are, considered representative, no such list should be
considered to be a complete statement of all potential risks and
uncertainties. For additional information about other factors that
could cause actual results to differ materially from those
described in the forward-looking statements, please refer to DISH
Network's and EchoStar Corporation's respective periodic reports
and other filings with the SEC, including the risk factors
identified in each of DISH Network's and EchoStar Corporation's
most recent Quarterly Reports on Form 10-Q and Annual Reports on
Form 10-K. The forward-looking statements included in this
communication are made only as of the date hereof. Neither DISH
Network nor EchoStar Corporation undertakes any obligation to
update any forward-looking statements to reflect subsequent events
or circumstances, except as required by law.
No Offer or Solicitation
This communication is not intended to and shall not constitute
an offer to buy or sell or the solicitation of an offer to buy or
sell any securities, or a solicitation of any vote or approval, nor
shall there be any sale of securities in any jurisdiction in which
such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made, except by
means of a prospectus meeting the requirements of Section 10 of the
U.S. Securities Act of 1933, as amended.
Additional Information about the Transaction and Where to
Find It
In connection with the proposed transaction, DISH Network and
EchoStar Corporation intend to prepare a joint information
statement for its respective stockholders containing the
information with respect to the transaction contemplated by Rule
14c-2 of the Exchange Act and describing the proposed transaction.
DISH Network intends to file with the SEC a registration statement
on Form S-4 that will include the joint information statement. The
joint information statement will also be filed with the SEC. Each
of DISH Network and EchoStar Corporation may also file other
relevant documents with the SEC regarding the proposed transaction.
This document is not a substitute for the registration statement,
the joint information statement or any other document that DISH
Network or EchoStar Corporation may file with the SEC. INVESTORS
AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT,
THE JOINT INFORMATION STATEMENT AND ANY OTHER RELEVANT DOCUMENTS
THAT MAY BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR
SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY IF
AND WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and
security holders will be able to obtain free copies of the
registration statement and the joint information statement (if and
when available) and other documents containing important
information about DISH Network, EchoStar Corporation and the
proposed transaction, once such documents are filed with the SEC
through the website maintained by the SEC at
http://www.sec.gov. Copies of the documents filed with the
SEC by DISH Network will be available free of charge on its website
at https://ir.dish.com/. Copies of the documents filed with the SEC
by EchoStar Corporation will be available free of charge on its
website at https://ir.echostar.com/.
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SOURCE EchoStar Corporation; DISH Network Corporation