EchoStar Corporation Completes Hughes Acquisition

[Scott Greczkowski]

EchoStar Corporation Completes Hughes Communications, Inc. Acquisition

Combination creates a worldwide leader in satellite delivered video and broadband services



Englewood, Colorado and Germantown, Maryland, June 8, 2011–EchoStar Corporation (NASDAQ: SATS ) and Hughes Communications, Inc. (NASDAQ: HUGH) announced today the successful completion of EchoStar’s acquisition of Hughes.

EchoStar Corporation is recognized as a leader in the telecommunications industry for its innovation in satellite solutions and technology, and its broadcasting expertise. Hughes is the global leader in broadband satellite technologies and services, and a leading provider of managed network services. The combined companies will create a powerhouse in satellite based digital video and broadband technologies and services.

Under the terms of the transaction, Hughes’ shareholders will receive $60.70 per share without interest, which represents a premium of 31% over Hughes' unaffected closing share price of $46.43 on January 19, 2011. The funding of the acquisition is being supported by the recent successful placement of $1.1 billion of senior secured notes and $900 million of senior unsecured notes.

“This strategic combination will significantly expand our know-how to develop exciting new video and data products and solutions, opening up global market opportunities that leverage our leadership in the delivery of innovative video and broadband data services,” said Michael Dugan, Chief Executive Officer and President of EchoStar. “Hughes is the world’s leading provider of satellite broadband for home and office, with innovative network technologies, managed services and solutions for enterprises and governments globally. The two companies together will have an extensive fleet of owned and leased satellites, experienced personnel and com munications facilities around the world, creating a global leader in video and data transport.”

“We also want to express our appreciation for the FCC’s thorough but expeditious review process, approving the merger less than 82 days after public notice,” said Mr. Dugan.

 

[CK SatGuy]

Looking forward to what those two companies will do over the next year and beyond.

 

[nelson61]

The merger explains why Echostar dropped their BSS 17 Ghz licenses.

One entity (dish/Hughes/Echostar combo) can only have a limited number of licensed slots with unlaunched satellites. Both Echostar/Dish and Hughes were at the limit,

Looks like their growth area will be Hughes Spaceway 4, 5, & 6 (KA) satellites. Similar to the Directv KA satellites but multiuse (broadband, video, etc)

 

[ekilgus]

Now that Dish completely owns Hughes Communications, I wonder if Charlie intends to re-brand it perhaps to DishNet or something. After all, it's currently named after Howard Hughes. Right?

 

[PATECO]

Now that Dish completely owns Hughes Communications, I wonder if Charlie intends to re-brand it perhaps to DishNet or something. After all, it's currently named after Howard Hughes. Right?

Prior to being Named Hughesnet, It was named DirecWay, and before that DirecPC. Maybe we will see DishWay.

 

[rocatman]

How about Charlienet or ErgenWay.

 

[whatchel1]

DishMultiverse

 

[MikeD-C05]

DISH TURBO NET

 

[Steve Mehs]

Yeah, if you think 2Mb down for $90/month with a 400MB/day FAP is 'Turbo'.

Who cares who cares who owns HughesNet or what it will be called. Satellite internet has always been a turd, and will always be a turd.

 

[whatchel1]

Yeah, if you think 2Mb down for $90/month with a 400MB/day FAP is 'Turbo'.

Who cares who cares who owns HughesNet or what it will be called. Satellite internet has always been a turd, and will always be a turd.

Just wonder if they can come up w/ a better compression scheme to get over those problems. As 2Mb is just not fast enuff now.

 

[dan188]

Will dish customers benifit at all

 

[skyviewmark]

Yeah, if you think 2Mb down for $90/month with a 400MB/day FAP is 'Turbo'.

Who cares who cares who owns HughesNet or what it will be called. Satellite internet has always been a turd, and will always be a turd.

Not if you live in the middle of no where and dial-up is all you can get.. If you need internet it is worth the cost..

 

[knot]

Not if you live in the middle of no where and dial-up is all you can get.. If you need internet it is worth the cost..

agreed

 

[ekilgus]

Not if you live in the middle of no where and dial-up is all you can get.. If you need internet it is worth the cost..

I have to agree. Until DSL became available, I was stuck with WildBlue. Yes, the service pretty much sucked and was expensive, so the only way to summarize satellite internet is that it's better than dial-up, sometimes only marginally.

 

[Stargazer]

Dialup sucks compared to satellite and satellite sucks compared to land-based broadband (DSL/Cable/Fiber/WISP). There is a big difference between each one.

 

[englishtycoon]

Not if you live in the middle of no where and dial-up is all you can get.. If you need internet it is worth the cost..

Until 4G is fully rolled out

 

[toddhawk]

Until 4G is fully rolled out

I agree with this. Over the next 2-3 years I hope to see a lot of changes. Because of the "satellite download limits" (for those of you not on satellite that means that you can only download so much, then they slow you down.. sadly this limit is less than 1gb), all faster speeds on satellite currently mean is that you hit your limit "faster". Ultimately as was said before dialup sucks compared to satellite and satellite sucks compared to land-based broadband (DSL/Cable/Fiber/WISP). If 4G can fully take effect, "better satellite broadband" is probably not the answer as I see too many hurdles that can't be crossed. However where I am, I'm not sure that 4G will be a reality for a while so I'm curious to see how this all plays out. For today (after years of being on DSL or cable) with my new home, Satellite is all I have.

 

[Stargazer]

Some people in rural areas not only have issues picking up DSL/Cable (even WISP) but they also have an issue picking up cell phone signals allowing them not to use the data cards that pick up a signal from the cell phone towers. Another thing is that satellite broadband allow you to download unlimited from 2-7 am on Hughesnet and they have higher packages allowing for more on the monthly limit. I have read recently that one of the cell phone carriers is allowing you to pay $10 for each 1 gb used over the monthly limit and one cell phone carrier offering a 10 gb monthly plan instead of the usual 5 gb monthly limits.

 

[nelson61]

Excerpt from FCC analysis of Echostar/Hughes merger


[FONT=TimesNewRoman,Italic][FONT=TimesNewRoman,Italic][FONT=TimesNewRoman,Italic]"Public Interest Benefits. [/FONT][/FONT][/FONT][FONT=TimesNewRoman,Italic][FONT=TimesNewRoman,Italic][FONT=TimesNewRoman,Italic][/FONT][/FONT][/FONT]We next consider evidence of efficiencies and other public interest
benefits. The Applicants claim that synergies from the proposed transaction will produce several public
interest benefits. In reviewing the Applicants’ claims, we find that the proposed transaction could
facilitate an arrangement whereby EchoStar and DISH would be in a position to offer subscribers a
“double-play” bundle of satellite video and broadband, or perhaps a “triple-play” bundle of satellite video,
broadband, and voice.

With the increased capacity of the Jupiter 1 satellite, and with the ability toprovide the subscriber with a seamless technical experience, the proposed transaction could result in
increased competition to terrestrial multichannel video programming distribution providers, such as
Comcast and Verizon, which offer bundled services."

Jupiter 1 is the new name for Spaceway 4 scheduled for launch in 2012.

 

[Brussam]

I just stopped using HughesNet. I was constrained by the data limits of air-card Internet. There were months where my up/download data was 14.5GB+. Since a lot of my data traffic was upload, it didn't count. Only download data was counted and that was, for me, 475 MB per rolling 24 hour period. Plus there was the 2:00AM - 7:00AM download free period.

I now use Verizon data via Millenicom, a bulk reseller, and I have a 20GB monthly plan. So far, this travel season, we have been two places where we couldn't receive Verizon data. And that is withy a 89db antenna and a wired amplifier.

That is where the HughesNet shines. We were never at a place where we couldn't get a satellite shot. But it is nice not to have to setup the HughesNet dish.