DirecTV is buying rival Dish to create a pay-TV giant—over 20 years after it first tried

DirecTV said Monday that it will acquire Dish TV and Sling TV from its owner EchoStar in a debt exchange transaction that includes a payment of $1, plus an assumption of debt.

The prospect of a DirecTV-Dish combo has long been rumored, with headlines about reported talks popping up over the years. And the two almost merged more than two decades ago — but the Federal Communications Commission blocked their owners’ then-$18.5 billion deal, citing antitrust concerns.

The pay-for-TV market has shifted significantly since. As more and more consumers tune into online streaming giants, demand for more traditional satellite continues to shrink. And, although high-profile acquisitions have proven to be particularly tough under the Biden-Harris administration, that may make regulators more inclined to approve DirecTV and Dish’s pairing this time around.

The current deal could provide a key lifeline for EchoStar. The Colorado-based telecommunications company has reportedly faced the prospect of bankruptcy as it continues to burn through cash and see losses pile up.

In a recent securities filing, EchoStar disclosed that it had just $521 million in “cash on hand.” And the company forecast negative cash flows for the remainder of the year — while also pointing to major looming debt payments, with more than $1.98 billion of debt set to mature in November.

Shortly before DirecTV made its announcement, AT&T said it was selling its remaining stake in DirecTV to private equity firm TPG in a deal valued at about $7.6 billion.