EchoStar is preparing to file its satellite TV unit, Dish DBS, for bankruptcy

Backing the filing is a restructuring agreement EchoStar reached earlier this year that has the support of bondholders holding more than 82% of Dish DBS's roughly $10 billion in outstanding debt. According to an EchoStar securities filing, the agreement encompasses a series of transactions aimed at cutting the company's debt load, settling ongoing litigation with bondholders, and broadening EchoStar's options for potential dealmaking. Dish DBS has retained White & Case as legal counsel and FTI Consulting as financial advisor for the restructuring process, The Journal reported.

EchoStar, based in Englewood, Colorado, carries roughly $25 billion in total debt and has faced years of subscriber losses across its pay TV businesses. Pay TV revenue came in at $2.26 billion for the most recent quarter, representing a year-over-year drop of more than $260 million; over the same period, the company shed approximately 177,000 net subscribers.

The bankruptcy filing follows EchoStar's failed attempt to merge Dish Network with DIRECTV in 2024. Bondholders holding more than $10 billion in Dish Network and Dish DBS debt ultimately sank that transaction by declining to take part in a required debt exchange, arguing it was structured to shift billions of dollars in assets to other companies under EchoStar founder Charlie Ergen's control.

EchoStar has also been under pressure from the Federal Communications Commission over its obligations to build out a 5G network in the U.S. Spectrum license sales to AT&T $T, valued at $22.65 billion, and to SpaceX, valued at $17 billion, were arranged as a way to address the FCC's concerns, with the resulting proceeds slated to reduce a portion of the company's debt burden, according to EchoStar's most recent earnings report. Neither transaction has closed.

Interest payments on several bonds came due June 1 but went unpaid, with EchoStar pointing to its pending receipt of closing proceeds from the AT&T deal as the reason for the delay. By mid-June, EchoStar had announced that Dish DBS would cover those overdue obligations.

A regulatory filing from EchoStar described the competitive landscape facing Dish DBS as one of "intense and increasing competition from providers of video, broadband and/or wireless services." Its pay TV subscriber base stood at just over 6.6 million as of the latest available figures, The Journal reported.