DIRECTV Announces Termination of Agreement

[Scott Greczkowski]

Termination Follows Rejection by DISH DBS Noteholders of EchoStar Debt Exchange Offer Terms

DIRECTV to Continue Executing Strategy to Deliver Future of Pay TV to Consumers

EL SEGUNDO, Calif., Nov. 21, 2024 /PRNewswire/ -- DIRECTV (the "Company") today announced that it has notified EchoStar of its election to terminate, effective as of 11:59 p.m., ET on Friday, November 22nd, 2024, the Equity Purchase Agreement (EPA) pursuant to which it had agreed to acquire EchoStar's video distribution business, DISH DBS ("DISH"). The termination of the Agreement follows DISH DBS noteholders' failure to agree to the proposed Exchange Debt Offer Terms issued by EchoStar, which was a condition of DIRECTV's obligations to acquire DISH under the EPA.

"While we believed a combination of DIRECTV and DISH would have benefitted all stakeholders, we have terminated the transaction because the proposed Exchange Terms were necessary to protect DIRECTV's balance sheet and our operational flexibility," said Bill Morrow, CEO of DIRECTV. "DIRECTV will advance our mission to aggregate, curate, and distribute content tailored to customers' interests by pursuing innovative products and providing customers with additional choice, flexibility, and control. We are well positioned for the future with a strong balance sheet and support from our long-term partner TPG."

DIRECTV will continue to invest in next-generation streaming platforms and revolutionize the industry through new packaging options while integrating content from live TV alongside direct-to-consumer services.

The termination of the DISH acquisition does not affect TPG's acquisition of the remaining 70% stake in DIRECTV from AT&T, which is expected to close in the second half of 2025.

About DIRECTV

As a leader in sports and entertainment for 30 years, DIRECTV provides industry-leading content and an amazing user experience with or without a satellite. By reimagining what is possible, DIRECTV's mission is to aggregate, curate and deliver exceptional, innovative service tailored to customers' interests. In 2023, DIRECTV elevated the customer experience by delivering Gemini, which can integrate customers' content from their third-party streaming services onto a single one-stop, digital experience. At DIRECTV, the sports season never ends, and customers are treated to broadcasts of several major sports, including the NFL, MLB, NBA, NHL, and multiple domestic and international soccer leagues. DIRECTV provides customers the choice of watching sports, movies, and TV shows on their TVs at home or their favorite mobile devices via the DIRECTV app.

Contacts

Investor Contact: investors@directv.com

Media Contact: media@directv.com

SOURCE DIRECTV

 

[HipKat]

Seems very short-sighted by the bondholders who would lose all of it if Dish ended up on the firesale list

 

[Yespage]

DIRECTV will continue to invest in next-generation streaming platforms and revolutionize the industry through new packaging options while integrating content from live TV alongside direct-to-consumer services.

Didn't Dish revolutionize the industry with new packaging options?! Cute for Directv to say it though.

So Dish manages to meet debt requirements, and not sell off anything for it? They might own TPG money, but that'd be down the road?

 

[Bruce]

Seems very short-sighted by the bondholders who would lose all of it if Dish ended up on the firesale list

Actually, I believe more intelligent on their part, they picked the best out of two bad options.

Either take a deduction, invest with a company that will only provide Satellite TV services, that would have 5-6 years left, losing about 3 Million subs a year, pretty likely will go Bankrupt before the bonds reach maturity.

Or keep them with Echostar, that has a lot of other assets, spectrum the biggest, if Echostar can hold out until the FCC allows them to sell the spectrum, could be a windfall.

 

[HipKat]

Actually, I believe more intelligent on their part, they picked the best out of two bad options.

Either take a deduction, invest with a company that will only provide Satellite TV services, that would have 5-6 years left, losing about 3 Million subs a year, pretty likely will go Bankrupt before the bonds reach maturity.

Or keep them with Echostar, that has a lot of other assets, spectrum the biggest, if Echostar can hold out until the FCC allows them to sell the spectrum, could be a windfall.

Yeah I suppose that makes sense

 

[Bruce]

"While we believed a combination of DIRECTV and DISH would have benefitted all stakeholders, we have terminated the transaction because the proposed Exchange Terms were necessary to protect DIRECTV's balance sheet and our operational flexibility," said Bill Morrow, CEO of DIRECTV. "DIRECTV will advance our mission to aggregate, curate, and distribute content tailored to customers' interests by pursuing innovative products and providing customers with additional choice, flexibility, and control. We are well positioned for the future with a strong balance sheet and support from our long-term partner TPG."

DIRECTV will continue to invest in next-generation streaming platforms and revolutionize the industry through new packaging options while integrating content from live TV alongside direct-to-consumer services.

Didn't Dish revolutionize the industry with new packaging options?! Cute for Directv to say it though.

Charter has been saying the same thing for a couple of years now, they were able to get rid of some channels and add the with commercials streaming services.

Guess what, they have had 3 price increases in the last two years, no other new options, they actually got rid of a couple of less expensive packages that was available to me when I moved here ( but still not worth it).

 

[CSM]

I wonder if they will stick with this?

"DIRECTV will advance our mission to aggregate, curate, and distribute content tailored to customers' interests by pursuing innovative products and providing customers with additional choice, flexibility, and control. We are well positioned for the future with a strong balance sheet and support from our long-term partner TPG."

 

[Bruce]

I wonder if they will stick with this?

"DIRECTV will advance our mission to aggregate, curate, and distribute content tailored to customers' interests by pursuing innovative products and providing customers with additional choice, flexibility, and control. We are well positioned for the future with a strong balance sheet and support from our long-term partner TPG."

No.

They are paying $7 Billion, plus assuming DirecTV’s debt of $10B, have about 3 years before DirecTV is unprofitable, need to make as much as possible….fast.

 

[Scott Greczkowski]

I can only guess that there is probably a celebration in Denver today.

While I haven't publicly posted anything I have been told by contacts over the past few weeks that the saying inside the company has been "Go pound sand!"

In fact in talking to another person higher up, they said the "Go pound sand" saying was a kind way of saying "Go F* yourself."

Say what you will about Charlie, but once again he has pulled another rabbit out of his hat. And DISH again is in a good place. And like I have been saying since this now failed deal was announced, I predict it will ultimately buying DISH buying DIRECTV.

Lesson learned is once again never count Charlie out.

 

[comfortably_numb]

Lesson learned is once again never count Charlie out.

He is one shrewd dude.

 

[Bruce]

I can only guess that there is probably a celebration in Denver today.

While I haven't publicly posted anything I have been told by contacts over the past few weeks that the saying inside the company has been "Go pound sand!"

In fact in talking to another person higher up, they said the "Go pound sand" saying was a kind way of saying "Go F* yourself."

Say what you will about Charlie, but once again he has pulled another rabbit out of his hat. And DISH again is in a good place. And like I have been saying since this now failed deal was announced, I predict it will ultimately buying DISH buying DIRECTV.

Lesson learned is once again never count Charlie out.

I hate to be the person at TPG Capital that engineered the deal, Well we came close to buying both Satellite TV companies and only lost $2 Billion in doing so.

 

[comfortably_numb]

I hate to be the person at TPG Capital that engineered the deal

That person is probably flipping burgers today.

 

[Bruce]

That person is probably flipping burgers today.

As he should for making that type of deal.

Buying and investing in any type of Traditional TV is just not a good idea, based on current and future trends.

The only investment I have in that is Comcast, because of Broadband, not TV Services.

 

[b4pjoe]

I hate to be the person at TPG Capital that engineered the deal, Well we came close to buying both Satellite TV companies and only lost $2 Billion in doing so.

How did they lose $2 billion?

 

[Yespage]

I can only guess that there is probably a celebration in Denver today.

While I haven't publicly posted anything I have been told by contacts over the past few weeks that the saying inside the company has been "Go pound sand!"

In fact in talking to another person higher up, they said the "Go pound sand" saying was a kind way of saying "Go F* yourself."

Say what you will about Charlie, but once again he has pulled another rabbit out of his hat. And DISH again is in a good place. And like I have been saying since this now failed deal was announced, I predict it will ultimately buying DISH buying DIRECTV.

Lesson learned is once again never count Charlie out.

Directv? I still see Charlie running AT&T before all is said and done, with many scratching their heads wondering how in the heck that happened.

 

[Yespage]

That person is probably flipping burgers today.

Private equity is rougher than that. He probably is the burgers being flipped.

 

[nelson61]

So Dish manages to meet debt requirements, and not sell off anything for it? They might own TPG money, but that'd be down the road?

Bloomberg:
EchoStar confirmed in a filing on Friday that it had received written notice from DirecTV on Nov. 20. It added no termination fee or other payment is due from either party as a result.

 

[comfortably_numb]

no termination fee or other payment is due from either party as a result.

So, no $2.5B then?

 

[nelson61]

As he should for making that type of deal.

Buying and investing in any type of Traditional TV is just not a good idea, based on current and future trends.

The only investment I have in that is Comcast, because of Broadband, not TV Services.

TPG is not in the TV business, they are in the "money" business. In the Directv case as well as the proposed Dish deal, they do the numbers, and may buy a business that is losing customers based on the $$$ that will flow through to them over the expected life of the business if their investment meets their rate of return investment standards.

Those people that should be fired bought the rest of Directv traditional tv business and will make money on the deal.
They walked away from the Dish deal because the money the holdouts wanted, made the acquisition unprofitable.

The money they lost on the Dish deal is the cost of playing in their business segment's poker "game"

 

[b4pjoe]

Bloomberg:
EchoStar confirmed in a filing on Friday that it had received written notice from DirecTV on Nov. 20. It added no termination fee or other payment is due from either party as a result.

EchoStar Secures Massive $5.2B Funding, Restructures $5B Debt for 5G Network Expansion | SATS Stock News

EchoStar strengthens financial position with $5.2B secured notes and 96% noteholder support in debt exchange. Strategic moves extend maturities and boost 5G network development.

www.stocktitan.net

The repayment in full of the November 2024 DDBS maturity similarly enhances DDBS's debt maturity profile, leaving DDBS with zero long-term debt maturities due until July 2026.

Not until July 2026.