:max_bytes(150000):strip_icc()/GettyImages-2216199386-4752ff76634243049df98c28a9fed792.jpg "EchoStar Stock Soars as Firm Sells Spectrum to SpaceX, Says It Resolves FCC Issues")
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Key Takeaways
- EchoStar sold some of its spectrum allocations to Elon Musk’s SpaceX for about $17 billion.
- The deal follows a similar $23 billion spectrum licenses sale to AT&T late last month.
- EchoStar said the two deals should resolve issues raised by the Federal Communication Commission over the company’s wireless and satellite rights.
EchoStar (SATS) shares soared 20% Monday as the DISH TV and Boost Mobile operator sold some spectrum licenses to Elon Musk’s rocket and satellite company SpaceX for about $17 billion. It’s the second such major deal in two weeks as the company moved to alleviate pressures from federal regulators.
EchoStar said the deal for its AWS-4 and H-block spectrum allocations included $8.5 billion in cash and up to $8.5 billion in SpaceX stock. In addition, SpaceX will pay $2 billion worth of interest on EchoStar’s debt through November 2027.
EchoStar will also gain access to SpaceX’s next-generation Starlink Direct to Cell service for its Boost Mobile subscribers.
CEO Hamid Akhavan said that teaming with SpaceX would allow the company to realize its vision of providing direct-to-cell satellite connectivity for consumers.
Late last month, EchoStar sold $23 billion worth of low- and mid-band spectrum licenses to AT&T (T). The company noted today that it believes that agreement, along with the SpaceX one, “will resolve the Federal Communications Commission’s (FCC) inquiries.” Officials launched an investigation in May over whether EchoStar was meeting certain requirements for its wireless and satellite rights. President Trump eventually became involved, calling on the two sides to find a resolution.
