Yahoo Finance Dish Network Fields Financing Offers From Private Credit Firms
(Bloomberg) -- Dish Network Corp., the satellite-TV provider saddled with more than $20 billion in debt and losing customers, has received financing offers from private credit firms, according to people with knowledge of the matter.
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Dish has fielded at least one proposal of more than $1 billion for financing that would be linked to a so-called unrestricted subsidiary, or a unit that’s free to incur debt, said the people, who requested anonymity to discuss confidential talks. Among options on the table would be debt that is collateralized by Dish’s wireless spectrum, one of the people said.
A spokesman for Dish, co-founded by billionaire Charlie Ergen, declined to comment.
“We are in active discussions with numerous parties to secure committed financing to meet our future obligations and have received significant inbound interest from reputable counterparties looking to provide such financing in various forms and at various positions in our capital structure,” Dish Chief Financial Officer Paul Orban said on the company’s March 1 earnings call. “All of which we are carefully evaluating.”
Read More: Dish Keeps Losing Customers Amid Pressure to Repay Debt
Dish has been searching for ways to address fast-approaching maturities as it tries to transition its business from pay-TV to wireless services. Ergen’s Echostar Corp., the parent of Dish, in February scrapped a debt swap that would’ve provided some relief after bondholders pushed back on the deal.
In January, the company announced that it was shuffling assets including valuable spectrum licenses into new unrestricted subsidiaries, a maneuver that is often a prelude to discussions for new financing.
Among the moves, it transferred a handful of wireless spectrum licenses into a new legal entity under EchoStar. Dish also said it freed from debt covenants a new unit holding 3 million television subscribers.
The company’s creditors were angered by the moves because it shifted valuable assets out of their reach.
Bloomberg Intelligence senior credit analyst Stephen Flynn on Monday said in a note that “Echostar’s debt load of almost $22 billion is likely untenable, and the company could pursue maneuvers to improve liquidity and extend its maturity profile.”
Read more: EchoStar’s $22 Billion of Junk-Rated Debt Is Likely Untenable
--With assistance from Todd Shields.
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