Finance

Dish to Consolidate EchoStar DBS Assets

Says deal gives satellite TV company end-to-end control of Sling TV 1/31/2017 4:47 PM Eastern

Dish Network said it has reached an agreement with sister EchoStar Corp. to consolidate its Direct Broadcast Satellite assets and operations, a deal it says will give it end-to-end control of its OTT service Sling TV.

 

Dish said in a statement that the deal will involve the transfer of certain EchoStar assets and operations, including its EchoStar Technologies hardware and software development group, its national and regional uplink business, its managed fiber backhaul network serving all U.S. DMAs and its OTT development group to Dish in exchange for Dish's 80% economic interest in Hughes Retail Group, which houses Dish’s satellite broadband business, held in the form of a tracking stock.

 

In addition, Dish will receive EchoStar’s 10% stake in Sling TV, wireless spectrum licenses covering four markets in the 28 GHz band and certain real estate properties.

 

Dish launched Sling TV in 2015 and the OTT service has about 900,000 customers, according to estimates.

 

Dish will continue to market satellite broadband under the brand dishNET to rural customers.

 

This deal comes more than eight years after Dish split itself into two separate units – Dish Network for the satellite TV business and EchoStar for the equipment side.  Last week EchoStar said it would cease manufacturing standalone Slingboxes, which some observers saw as the end of an era. 

 

"With this transaction we will vertically integrate all the elements that define our customer experience - one team will deliver the full Dish and Sling TV experience end to end," Dish president Erik Carlson said in a statement. "Not only do we gain full control of product development roadmap for DBS and Sling TV but we also anticipate achieving operational efficiencies."

 

The transaction is expected to close in the first quarter of 2017.

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