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DirecTV announced Monday it’s buying rival Dish Network, ending multiple decades of on-and-off talks about the satellite services merging.
The companies have struggled to retain subscribers in the streaming era. As platforms like Netflix, Hulu and Amazon’s Prime Video have gained traction, peeling millions of subscribers away from pay TV with lower price tags and on-demand content, DirecTV and Dish have found it increasingly difficult to justify rising subscription costs, worsening already dramatic cord-cutting.
The companies said the “combination of DirecTV and Dish will benefit US video consumers by creating a more robust competitive force in a video industry dominated by streaming services owned by large tech companies and programmers.”
Under the deal, DirecTV will pay Dish’s owner, EchoStar, just $1 for Dish in exchange for assuming its billions of dollars in debt.
Private equity firm TPG, meanwhile, will acquire AT &T’s remaining 70% stake in DirecTV. The move comes nine years after AT &T purchased the company in 2015 only to sell a 30% stake to TPG in 2021, a DirecTV spokesperson told CNN.
The deal still hinges on Dish bondholders agreeing on net debt lower than $1.56 billion, which a DirecTV spokesperson said the company will look to secure in the coming weeks. Bondholders can accept a lower percentage, take a slightly higher percentage today, or wait it out, which risks Dish ending up in bankruptcy.
