The spectrum transformation is in sight! Echostar expects to hold $24.1 billion in cash after debt repayment
Echostar expects to have $24.1 billion in cash after repaying debts with the proceeds from the sale of spectrum licenses, enhancing its balance sheet to support growth in wireless, satellite, and technology sectors. The company sold spectrum licenses to AT&T and SpaceX for $23 billion and $17 billion, respectively. The FCC will terminate its investigation into the company's 5G service deployment. Echostar's stock price rose by 1.28%, up nearly 230% this year
According to the Zhitong Finance APP, Echostar (SATS.US) announced on Monday that it expects to have a total of $24.1 billion in cash after repaying debts with the proceeds from the sale of its spectrum licenses. This move will strengthen its balance sheet and support growth in the wireless, satellite, and technology sectors.
The satellite communication company sold part of its wireless spectrum licenses to AT&T (T.US) for $23 billion and also sold spectrum licenses worth approximately $17 billion to SpaceX. Prior to this, Echostar was questioned by the Federal Communications Commission (FCC) for not fully utilizing its spectrum resources.
Echostar's CEO Hamid Akhavan stated that the recent cash proceeds from spectrum transactions will reach $31.2 billion, and the company will repay $11.4 billion in debt.
As of June 30, the company's total cash amounted to $4.33 billion.
After Echostar reached agreements with AT&T and SpaceX, the FCC announced last week that it would terminate its investigation into Echostar's slow deployment of 5G services in the U.S.
Echostar's Chairman Charlie Ergen stated, "The FCC's directive to us is that we can only take a logical path."
Akhavan mentioned that some spectrum is still under the company's control, including the AWS-3 band, which has been deployed among all major national operators.
The transactions between Echostar and AT&T and SpaceX still require FCC approval.
Echostar will continue to operate its satellite TV service Dish TV and streaming TV platform Sling, while shifting its internet service Hughes to the enterprise customer segment.
As of the time of publication, Echostar's pre-market shares rose by 1.28%. The stock has increased nearly 230% year-to-date
