{"id":85370,"date":"2011-02-14T20:43:33","date_gmt":"2011-02-14T12:43:33","guid":{"rendered":"https:\/\/wp-productionenv-bjg9h2g2bgg5b8aa.southeastasia-01.azurewebsites.net\/news\/echostars-purchase-of-hughes-caps-aggressive-acquisition-strategy\/"},"modified":"2011-02-14T20:43:33","modified_gmt":"2011-02-14T12:43:33","slug":"echostars-purchase-of-hughes-caps-aggressive-acquisition-strategy","status":"publish","type":"post","link":"https:\/\/starpath.global\/news\/echostars-purchase-of-hughes-caps-aggressive-acquisition-strategy\/","title":{"rendered":"EchoStar\u2019s Purchase of Hughes Caps Aggressive Acquisition Strategy"},"content":{"rendered":"<p>[02-14-11] <strong>EchoStar<\/strong> entered into an agreement to acquire <strong>Hughes Communications <\/strong>and its subsidiaries, including its main operating subsidiary <strong>Hughes Network Systems<\/strong>, for about $2 billion, EchoStar announced Feb. 14.<br \/>\n&nbsp;&nbsp;&nbsp; The transaction, which has been approved by the boards of both companies as well as by <strong>Apollo Management<\/strong>, Hughes\u2019 previous majority stockholder, will see EchoStar pay Hughes\u2019 shareholders $60.70 per share without interest. The payment includes a 31 percent premium from Hughes\u2019 Jan. 19 closing price of $46.43. In January, analysts speculated that Apollo\u2019s auction of Hughes would generate a per-share price in the mid-$60 region. <br \/>\n&nbsp;&nbsp; EchoStar president and CEO Michael Dugan said the transaction aims to enhance his company\u2019s video and data broadband transport capabilities. \u201cThere is a unique and compelling fit between Hughes and EchoStar. With a rich engineering culture, an extensive fleet of owned and leased satellites and experienced personnel in communications centers around the world, the combination of EchoStar and Hughes will create a powerful leader in video and data transport,\u201d Dugan said in a statement.<br \/>\n&nbsp;&nbsp;&nbsp; The transaction is expected to close later this year, subject to closing conditions and federal regulatory approvals. <br \/>\n&nbsp;&nbsp;&nbsp; Apollo Management has held a 57 percent stake in Hughes since 2004. <strong>Raymond James<\/strong> analyst Chris Quilty told <em>Satellite News <\/em>that Apollo\u2019s desire to auction off the company might have been an effort to avoid a liquidity trap. \u201cWe suspect that Apollo may have grown frustrated with Hughes\u2019 consistently depressed \u2018public company\u2019 valuation (historically two to four times its forward EBITDA, as compared to seven to 10 times for ViaSat, Hughes\u2019 closest peer). \u2026 We have regularly argued that Hughes\u2019 valuation discount is primarily a byproduct of the stock\u2019s minimal float and poor trading liquidity,\u201d he said.<br \/>\n&nbsp;&nbsp;&nbsp; EchoStar and sister company Dish Network have been involved in several major acquisitions over the past few months. <br \/>\n&nbsp;&nbsp;&nbsp; Dish Network entered into an agreement Feb. 1 to acquire hybrid satellite and terrestrial communications company <strong>DBSD North America<\/strong> for about $1 billion. DBSD, which filed for chapter 11 bankruptcy protection in May 2009, will receive an $87.5 million debtor-in-possession credit facility from Dish Network in exchange for the inclusion of the 7.5 percent interest accrued on DBSD\u2019s existing debt to the acquisition price. The credit facility, which remains subject to approval by the U.S. Bankruptcy Court, will consist of a non-revolving, multiple draw term loan. <br \/>\n&nbsp;&nbsp;&nbsp; That acquisition was followed by a <strong>Credit Suisse<\/strong> report, issued Feb. 10, claiming that<strong> AT&amp;T<\/strong> was looking to acquire Dish Network. \u201cWhat AT&amp;T believes, I think, is if you bundle Dish and AT&amp;T wireless on a national basis, that would reduce churn for all products and potentially drive penetration. Not only would it expand the customer base of AT&amp;T but also lower churn because of the new stickiness,\u201d Credit Suisse Analyst Jonathan Chaplin said in the report.<br \/>\n&nbsp;&nbsp;&nbsp; In January, EchoStar\u2019s Advanced Technologies subsidiary also acquired <strong>Move Networks<\/strong>, a video streaming technology developer based in Utah, inheriting Move Network\u2019s global customer base of service providers and content owners in the United States, Germany, Latin America and the Middle East. The company said the acquisition also enables EchoStar to expand its portfolio of television technologies serving cable, satellite, telcos and IPTV video providers.<br \/>\n&nbsp;&nbsp;&nbsp; \u201cWe first introduced our products in 2006 and quickly proved that adaptive streaming was the breakthrough invention that proved primetime television programming and professional, long-form video can be reliably delivered over the Internet at the high-resolution quality that is intended. We look forward to the joint efforts of Move and EchoStar engineers in furthering technology innovation in online video delivery worldwide,\u201d Move Networks Founder Drew Major said in a statement.<br \/>\n&nbsp;&nbsp;&nbsp; Financial terms of the Move Networks acquisition were not disclosed.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[02-14-11] EchoStar entered into an agreement to acquire Hughes Communications and its subsidiaries, including its main operating subsidiary Hughes Network Systems, for about $2 billion, EchoStar announced Feb. 14. &nbsp;&nbsp;&nbsp; The transaction, which has been approved by the boards of both companies as well as by Apollo Management, Hughes\u2019 previous majority stockholder, will see EchoStar [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[2],"tags":[],"class_list":["post-85370","post","type-post","status-publish","format-standard","hentry","category-news"],"acf":[],"_links":{"self":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/85370"}],"collection":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/comments?post=85370"}],"version-history":[{"count":0,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/85370\/revisions"}],"wp:attachment":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/media?parent=85370"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/categories?post=85370"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/tags?post=85370"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}