Dish Network’s parent company Echostar is weighing the sale of $3 billion in bonds that would be backed by some of its wireless spectrum, according to a report.
The report, published by Bloomberg Intelligence, said Echostar would leverage its 20 Megahertz (MHz) Advanced Wireless Services (AWS-4) spectrum as collateral. The spectrum was inherited from Dish Network’s wireless division in January when Dish and Echostar formalized their merger.
The plan comes after Echostar scrapped two different plans to swap some of its maturing debt for long-term bonds, a move that rankled some of its creditors.
Its most recent offer was to swap more than $6 billion in unsecured notes that were to mature over the next five years for long-term bonds that were backed by Dish’s three million pay television subscribers, the Wall Street Journal reported.
Echostar is in dire need of more cash to help Dish fund its build-out of its fifth-generation wireless network, which is encumbered by deadlines imposed by the Federal Communications Commission (FCC).
Dish was tasked with developing a fifth-generation wireless network following its acquisition of prepaid phone brand Boost Mobile from Sprint, which the latter was required to divest in order to satisfy regulatory concerns over its merger with rival T-Mobile several years ago.
