EchoStar Corporation (NASDAQ:SATS) is set to substantially increase its satellite communications capabilities through the acquisition of Hughes Communications (NASDAQ:HUGH).
Colorado headquartered EchoStar is paying US$60.70 per shares for Hughes Communications, or approximately US$1.35 billion. Including debt, the transaction values Hughes operating subsidiary Hughes Network Systems at around $3 billion.
Hughes is a player in the broadband satellite network sector, servicing government, enterprise and small business.
The Maryland headquartered group has shipped over 2.5 million systems to customers across the globe. EchoStar is focused on equipment sales of digital and satellite set-top boxes and related products. The group also owns 10 satellites and 10 digital broadcast centers.
The combined company will be capable of delivering larger amounts of video and data across their combined network. Michael Dugan, President and CEO of EchoStar said the transaction was a unique and compelling fit.
"With a rich engineering culture, an extensive fleet of owned and leased satellites, and experienced personnel in communications centers around the world, the combination of EchoStar and Hughes will create a powerful leader in video and data transport."
Shares in Hughes Communications closed on Friday at $6178 per share, but are up approximately 30% since speculation of a deal surfaced.