Report: DOJ May Nix DBS Merger

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Reuters reports that Department of Justice staff are recommending that the
government block EchoStar Communications Corp.'s proposed purchase of Hughes
Electronics Corp., parent of satellite-television rival DirecTV Inc., sources
said Tuesday.

Attorneys in the department's Antitrust Division have sent the recommendation
to division chief Charles James, who is expected to make a final decision soon,
the sources said.

The two companies have argued that their $15.37 billion deal would enable
them to provide more services and to better compete with local cable-TV
monopolies.

EchoStar spokesman Marc Lumpkin said the DOJ and the Federal Communications
Commission continued to review the merger proposal. 'As far as we understand,
the process is not complete,' he added.

Hughes spokeswoman Toni Simonetti expressed skepticism about the news
reports, saying that the DOJ still has not finished taking depositions in
connection with the case.

If approved, the deal would give the combined company some 18.2 million
subscribers.

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