Charlie Ergen's Dish Network received final approval from a bankruptcy court judge to purchase TerreStar Networks for $1.375 billion, despite objections raised by AT&T (NYSE:T).
TerreStar Genus satellite smartphone
The deal has been approved by TerreStar's creditors, which include the Ergen-owned EchoStar. The purchase nearly matches the $1.4 billion Dish will pay for DBSD North America, which won court approval last week. Together DBSD and TerreStar give Dish access to 20 MHz channels of S-band spectrum.
Dish was the only bidder in the auction for TerreStar. TerreStar first filed for bankruptcy in October 2010.
Ergen received court approval on the deal despite some objections raised by other parties. AT&T, which sells the TerreStar Genus satellite smartphone, objected to the sale because it said the plan could prevent it from seeking protection from Dish in case consumers claim damages against AT&T for problems related to the phone.
Now that Dish has access to DBSD and TerreStar's spectrum, there has been speculation that Ergen might use it in some kind of wireless play. However, BTIG analyst Walter Piecyk said that he does not expect Ergen to make any moves in the near future.
"They still have to get the licenses, Piecyk told FierceWireless. "I think that's an important aspect of this, because if you are Dish or Charlie Ergen, you probably don't want to do or say anything to increase the risk of the FCC transferring the licenses to you. I don't know what he's planning on doing, but even if he did have a game plan, it's not something he would do until he gets those licenses." That likely won't happen until the end of the year at the earliest, Piecyk said.
Still unresolved is Sprint Nextel's (NYSE:S) claim that that TerreStar owes it $104 million for band-clearing fees. The two sides are expected to continue to debate that in court.
- see this Dow Jones Newswires article
- see this Bloomberg article
- see this Reuters article
- see this separate Reuters article
Dish Network lands $1.38B bid for TerreStar, reportedly outflanking MetroPCS
Bankrupt TerreStar extends deadline for bids on assets
Dish's Ergen: No 'grand strategy' on spectrum play
Dish's $1B DBSD purchase sparks spectrum intrigue
Report: MetroPCS interested in TerreStar's spectrum
TerreStar files for bankruptcy