In a June meeting first reported by Bloomberg, former President Donald Trump encouraged EchoStar Chairman Charlie Ergen and FCC Chairman Brendan Carr to reach a deal to resolve a lingering spectrum dispute. EchoStar had explored selling the assets to other potential buyers, including Elon Musk’s Starlink, according to Bloomberg.
AT&T said its planned acquisition of roughly 30 MHz of mid-band spectrum and 20 MHz of low-band spectrum will bolster its ability to deliver 5G and fiber services nationwide. EchoStar will continue operating in the U.S. as a hybrid mobile network operator under its Boost brand, with AT&T serving as its primary network partner.
In a separate statement, Ergen described the sale and partnership with AT&T as “critical steps toward resolving the FCC’s spectrum utilization concerns.”
During a Tuesday investor call, AT&T CEO John Stankey addressed potential regulatory worries over spectrum concentration. “The dynamics of what’s occurring in the market support the fact that concentration really isn’t an issue,” Stankey said. “Getting more capacity out into the market is ultimately a good thing for consumers over the long haul.”
AT&T has been aggressively expanding its fiber-optic network nationwide, previously noting it would use cash savings from Trump’s tax and spending bill to accelerate these efforts. In May, the company agreed to acquire Lumen Technologies Inc.’s consumer fiber operations for $5.75 billion, extending its high-speed broadband service to major cities such as Denver and Las Vegas.
The EchoStar acquisition will be funded through a mix of cash on hand and borrowings. AT&T reiterated plans for up to $20 billion in share repurchases through 2027. Jefferies Financial Group Inc. served as AT&T’s advisor on the deal.
EchoStar, which had $5 billion in cash on its balance sheet, also committed to resuming bond payments, including interest on previously defaulted amounts. Bond market signals suggested creditors did not anticipate significant losses, potentially paving the way for a faster resolution through federal court mediation, which could otherwise have dragged on.
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