EchoStar files new proposal to buy DirecTV

[Gregg Lengling]

DENVER (November 29, 2002 11:11 a.m. EST) - EchoStar Communications has filed a revised proposal to buy Hughes Electronics' DirecTV with federal regulators.

EchoStar, owner of the Dish Network satellite-TV service, submitted the plan with the Federal Communications Commission on Wednesday but declined to make the filing public.

"We will let the FCC handle that," EchoStar spokesman Marc Lumpkin said. "We want to make sure we follow their processes."

Last month, the FCC and Justice Department said the $18.8 billion union would create a monopoly in rural areas and reduce choice in almost all other areas.

Industry analysts doubt any plan will change the minds of regulators.

"Justice and the FCC were loud and clear," said Ted Henderson, an analyst with Stifel Nicolaus & Co. in Denver. "I don't care what kind of revised plan they offer - this merger is not going to go through."

If the merger does not go through by Jan. 21, Littleton-based EchoStar must pay a $600 million breakup fee to El Segundo, Calif.-based Hughes, a unit of General Motors Corp. If DirecTV pulls out before then, it must pay EchoStar.

Both companies must show that they took all possible steps to get the merger approved to avoid paying the fee.

Shares of EchoStar gained 9 cents to $20.25 in morning trading Friday on the New York Stock Exchange. Shares of Hughes fell 5 cents to $11.40 on the New York Stock Exchange.