The satellite TV business Dish DBS and Dish Wireless filed for Chapter 11 bankruptcy on Tuesday, stating the move will facilitate transitioning the Dish Wireless business after the company’s spectrum sales.
EchoStar announced a “prepackaged” bankruptcy plan on Tuesday, citing support from 88% of creditors, holding more than $8.8 billion of Dish Wireless debt.
Dish DBS operates the company’s pay-TV business through subsidiaries, and Dish Wireless and its subsidiaries formerly operated a facilities-based 5G wireless network. EchoStar exited the 5G business when it moved to sell its spectrum to AT&T.
However, EchoStar noted in the release that the AT&T transaction has not closed “due to unforeseen delays.”
“The filing will permit Dish Wireless and its subsidiaries to complete the transition of their business and dispose of their remaining assets in an orderly and expedited manner. The Chapter 11 process will provide a forum for the determination of all claims against DISH Wireless and the distribution of proceeds from the sale of its remaining assets,” EchoStar said in a statement.
The plan is subject to court approval, but EchoStar expects exit from Chapter 11 before the end of the third quarter of this year, “without impacting the company’s active operations.”
The filing does not impact the overall EchoStar Corporation, Hughes Satellite Systems Corporation or the Boost Mobile and Gen Mobile brands, EchoStar said.
It will also not impact the $2.4 billion fund the FCC required EchoStar to establish when it approved its spectrum sales, in order to settle claims from tower companies, backhaul providers, and construction firms part of building the Dish Wireless 5G network.
