In an SEC filing, Dish says it can’t buy T-Mobile’s 800MHz spectrum as it heads toward bankruptcy،
You may remember the story we've been following for a while now about an option granted by T-Mobile to Dish to purchase 13.5 MHz of 800 MHz low-band spectrum. The option was given to Dish as part of the agreements which T Mobile The move with the FCC is to get the regulatory agency to approve the wireless service provider's acquisition of Sprint. Originally, the option gave Dish until June 30, 2023 to pay T Mobile the $3.59 billion price tag for the airwaves. But due to Dish's financial situation, the date had to be postponed.
After some negotiations, Dish gave T Mobile $100 million to purchase the spectrum in exchange for a revised expiration date of April 1, 2024. Coincidentally, this is the fourth anniversary of T Mobilecloses its acquisition of Sprint. This might be the easiest $100 million ever T Mobile never happened because Dish, in a filing with the Securities & Exchange Commission (SEC), said it could not obtain the financing it would need to pay T Mobile $3.59 billion before the April 1 deadline.
In the SEC filing, Dish wrote: “Due to the relatively short time remaining before the 800 MHz purchase option expires on April 1, 2024, we no longer believe it is likely that we will exercise the option. Therefore, we reduced the weighted probability. value of the spectrum option to zero.”
The expiration of the option will not have a big impact on Dish according to Recon Analytics analyst Roger Entner. The analyst notes that even though 800 MHz low-band signals travel long distances, the amount of spectrum covered by the option was not enough to allow Dish to add additional capacity or provide additional services.
The recently merged Echostar/Dish Network warned in its SEC filing that there were “substantial doubts” about the company's continued existence. With a combination of debt maturing in 2024 and the high likelihood that it will consume “a substantial amount of liquidity” over the next 12 months, this “raises substantial doubt as to [the company’s] ability to continue its business,” the company said in the filing.
While Dish has said it will pay the debt maturing this month using its liquidity and cash flow, it says it does not have the cash on hand nor does it anticipate having the cash flow. cash needed to pay the November 2024 debt maturity. “and subsequent interest on our outstanding debt.” This led Craig Moffett, an analyst at MoffettNathanson, to declare, “Dish's business is heading toward bankruptcy.”
Dish lost 123,000 prepaid subscribers during the fourth quarter of 2023, a significant increase from the 25,000 prepaid subscribers lost during the same quarter a year earlier. Dish has 7.38 million Boost subscribers remaining and Moffett says Dish has lost 2.6 million Boost subscribers since it began offering wireless service in 2020.
Moffett, the analyst, added: “To state the obvious, neither the Boost prepaid business nor the nascent 5G business appear to be a significant operating asset in the likely event of bankruptcy. The spectrum recovery value is all there is here. »
