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Technology Stocks : Echostar Comm. -- Ignore unavailable to you. Want to Upgrade?

To: Stoctrash who wrote (1344)	8/5/2001 8:00:48 PM
From: Glenn Petersen	Read Replies (2) \| Respond to of 1394

DISH makes an offer for Hughes: dailynews.yahoo.com Sunday August 5 7:43 PM ET EchoStar Bids $32 Billion for Hughes By Jed Seltzer NEW YORK (Reuters) - Satellite television provider EchoStar Communications Corp. (Nasdaq:DISH - news) said on Sunday it is making a $32 billion bid for Hughes Electronics Corp. (NYSE:GMH - news) in a move that could trump rival News Corp. in a battle for Hughes' coveted DirecTV network. EchoStar is proposing to offer 0.75 of its shares for each Hughes share, valuing Hughes' stock at about $22.83 per share, an 18 percent premium based on Hughes' closing price on Friday. EchoStar also said it would assume about $1.9 billion in Hughes debt. EchoStar competes with global media giant News Corp. (NYSE:NWS - news) (NCP.AX), which seeks to merge DirecTV with its Sky Global network of satellite services. Littleton, Colorado-based EchoStar operates the Dish Network, the No. 2 U.S. satellite television service. El Segundo, California-based Hughes, a unit of automobiles giant General Motors Corp. (NYSE:GM - news), has been negotiating for the sale of DirecTV since last fall. Shareholders of General Motors and Hughes would own about 66 percent of the diluted equity in the combined company under the EchoStar bid. General Motors said in May it had approved talks between Hughes and News Corp., controlled by media mogul Rupert Murdoch and based in Australia. General Motors and News Corp. have been engaged in discussions over Hughes for some time and had negotiations as recently as last week, sources familiar with the situation have said. EchoStar, meanwhile, said on July 19 that it could not convince the Hughes' board to make a deal. Officials at General Motors and News Corp. were not immediately available for comment. EchoStar said it has identified massive synergy opportunities valued at about $37 billion, or $26 per share, for Hughes shareholders and up to $11 billion, or $20 per share, to General Motors shareholders. In a letter to GM Chairman John Smith, EchoStar Chairman and Chief Executive Charles Ergen said a combination of Hughes and EchoStar could establish a competitive alternative to the powerful U.S. cable and broadband service providers. ``The combined company's unrivaled satellite network and subscriber base would enable it to achieve greater profitability than either company would be able to achieve on its own,'' Ergen wrote. DirecTV, the largest U.S. satellite television broadcaster, has already embarked on a strategy of delivering communications through broadband networks. A broadband network is one in which the ``bandwidth,'' or range of frequencies, can be divided and shared by multiple simultaneous signals such as voice, data or video. The letter states that the management of Hughes and DirecTV have recently informed EchoStar that they do not intend to pursue merger discussions with EchoStar. ``In light of the enormous benefits of our proposed combination, we are submitting this proposal directly to you for you for your consideration,'' Ergen wrote to Smith. Ergen said his company has reviewed the potential deal with antitrust experts, including David Boies of Microsoft Corp. (Nasdaq:MSFT - news) antitrust trial fame, and EchoStar is confident it could obtain antitrust clearance in a ``reasonable'' timeframe. Although DirecTV is the coveted aspect of the deal, Hughes also controls satellite network PanAmSat Corp. (Nasdaq:SPOT - news) and Hughes Network Systems, which supplies wireless business networks and telecommunications equipment. EchoStar's Dish Network serves more than 6 million subscribers in the continental United States. Ergen owns more than half of the company but retains about 90 percent of the voting power. Shares of EchoStar closed at $30.44 on Friday on Nasdaq, off the 52-week high of $56.44 and up from a low of $20.50. Shares of News Corp., which owns most of Fox Entertainment Group, closed at $38.25 on the New York Stock Exchange (news - web sites) on Friday, off a high of $57.50 in the past year and up from the low of $28.65. Shares of Hughes, which closed at $19.36 on Friday on the New York Stock Exchange, have reached as high as $38.00 in the past year but are barely up from the low of $17.55.