Dish Network Seeks $15 Billion Bank Financing to Bid on T-Mobile

by Istvan Fekete on June 15, 2015

Dish Network has turned to the banks in an attempt to obtain between $10 billion and $15 billion of debt financing in to bid for T-Mobile. The money obtained from the banks would be the cash portion of the fusion between the two companies, multiple reports have confirmed.

Both the Wall Street Journal and Reuters cite anonymous sources saying Dish’s push to secure financing is a clear sign that the company is making progress with its bid for the country’s fourth-largest carrier, or, in the worst case scenario, Dish thinks it is. T-Mobile has a market value of $31 billion, which Dish is estimating at $34 billion.

Both new outlets seem to corroborate the same thing: The deal between T-Mobile and Dish would be more share-based than cash-based. During the past several years, Dish, the country’s second-biggest satellite-television provider, has consistently expressed interest in entering the wireless market and has recently been acquiring airwave licences.

If the two strike a deal, they could unleash an avalanche of consolidation across the US media and communications industries as companies scramble to adapt to new online offerings to remain competitive.

We can take it as an early sign of partly successful negotiations that Dish and T-Mobile have already agreed Mr. Ergen would be the combined company’s chairman, while T-Mobile CEO John Legere would be CEO, according to an earlier report from the Wall Street Journal.

A Moody’s Investors Service analyst has already painted the future of T-Mobile and its biggest shareholder: If a “$14 billion cash and the rest stock” deal receives the green light, Deutsche Telekom (which currently owns 66% of T-Mobile) would remain with a stake of about 27% in the combined company.

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Written by: Istvan Fekete. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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