DirecTV Scraps Dish Acquisition Amid Bondholder Pushback

Deal News | Nov 22, 2024 | EIN

DirecTV has announced the cancellation of its proposed acquisition of Dish Network, marking another failed attempt at merging the two rival satellite-TV providers. The decision comes after significant pushback from bondholders of Dish and its subsidiary DBS, who were unwilling to accept terms that involved a substantial reduction in their holdings in exchange for more secure debt in the merged entity. This development follows EchoStar's September announcement to offload its video distribution operations, including Dish and Sling TV, to DirecTV for a nominal sum to address its debt issues. Despite the dissolution of this merger, DirecTV's CEO, Bill Morrow, emphasizes the company's robust financial position supported by TPG, which continues its parallel acquisition of a 70% stake in DirecTV from AT&T, a deal expected to conclude by late 2025. While EchoStar sees a slight uptick in trading, AT&T's market position remains largely unchanged.

Sectors

Telecommunications
Private Equity

Geography

United States – The article involves companies and transactions taking place within the U.S., such as the merger talks between DirecTV, Dish Network, and involvement of TPG.

Industry

Telecommunications – Involves companies that transmit data in words, voice, audio, or video across the globe. The article discusses satellite-TV providers DirecTV and Dish Network, which fall under this sector.
Private Equity – Involves investment funds that acquire businesses and potentially restructure them to increase value. TPG's involvement in acquiring a significant stake in DirecTV categorizes the article within this sector.

Financials

$10.7 billion – Total debt held by bondholders in Dish and DBS who resisted the merger deal.
$1.5 billion – The haircut bondholders would have taken in the proposed merger with DirecTV.
$9.75 billion – Debt DirecTV would have assumed in the proposed acquisition of Dish.
$7.6 billion – Sale price of AT&T's 70% stake in DirecTV to TPG.

Participants

Name	Role	Type	Description
DirecTV	Target company seeking to acquire Dish Network	Company	A major satellite television provider in the United States.
Dish Network	Target company for acquisition by DirecTV	Company	A satellite television company and competitor to DirecTV.
EchoStar	Parent company of Dish, seeking to sell Dish to DirecTV	Company	Parent company involved in technology and communications.
TPG	Acquirer of DirecTV stake	Company	A global private equity firm actively acquiring a significant stake in DirecTV.
AT&T	Seller of DirecTV stake to TPG	Company	Telecommunications giant selling its stake in DirecTV.
Bill Morrow	CEO of DirecTV	Person	Chief Executive Officer of DirecTV.