Sunday, February 13, 2011

EchoStar to Acquire Hughes for Broadband Satellite Capabilities

EchoStar agreed to acquire Hughes for approximately $2 billion including Hughes' debt. Hughes' shareholders will receive $60.70 per share without interest, which represents a premium of 31% over Hughes' unaffected closing share price of $46.43 on January 19, 2011.



Hughes, and its main operating subsidiary, Hughes Network Systems, provide broadband satellite networks and services for enterprises, governments, small businesses, and consumers. HughesNet is the leading broadband satellite Internet service in North America with over 500,000 consumer/SMB subscribers. Hughes operates the Ka-band SPACEWAY 3 satellite, which was the first commercial satellite with on-board switching and routing.



For businesses, Hughes has shipped more than 2.5 million satellite systems to customers in over 100 countries. The company also designs and builds satellite Network Operations Centers (NOCs) and gateways; two-way broadband satellite routers; mobile satellite handhelds and high-speed IP data terminals; and broadband wireless systems.
Hughes is based in Germantown, Maryland.



EchoStar is focused on creating hardware and service solutions for cable, telco, IPTV and satellite TV companies worldwide. EchoStar also delivers satellite services, including its ViP-TV IP-encapsulated video transport service, through 10 owned and leased in-orbit satellites and related FCC licenses, which includes a network of 10 full-service digital broadcast centers and leased fiber optic capacity with points of presence in more than 210 U.S. markets. The company is based in Englewood, Colorado. It also owns Sling Media.



Pradman Kaul, President and Chief Executive Officer of Hughes, stated, "We are very pleased to announce this transaction as it brings together the two premier providers of satellite communications services and delivers substantial value to our shareholders. By combining Hughes' operational strength and proven record of customer satisfaction with EchoStar's expertise in cutting edge satellite video technology, customers will benefit significantly from our shared institutional excellence."http://www.echostar.com http://www.hughes.com

  • In October 2010, BNP Paribas and Societe Generale have agreed to provide a $115 million loan guarantee to Hughes Network Systems for the launch of Jupiter, its next generation, high-throughput, Ka-band satellite. The loan is guaranteed by COFACE, the French Export Credit Agency, and Arianespace has been contracted by Hughes to launch Jupiter in the first half of 2012. Switching capacity aboard the next-generation Jupiter satellite is expected to be 100 Gbps -- ten times the current generation SPACEWAY 3 with 10 Gbps of capacity.


  • In January 2011, EchoStar acquired the assets of Utah-based Move Networks, which specializes in large scale streaming of quality video on the Internet.


  • Launched by Arianespace in August 2007, the geostationary SPACEWAY 3 satellite offer 10 Gbps of gross capacity. It was designed and developed as a next-generation, Ka-band broadband satellite system, and is the world's first commercial satellite to employ on-board traffic switching and routing. It also features dynamic beam forming, and direct small-dish-to- small-dish connectivity for subscribers.

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