Shares of EchoStar rose as much as 26% on Monday in New York to a record high of US$84.48. Its bonds were the biggest gainers in the junk-bond market, according to Trace pricing data.
SpaceX, the Elon Musk-backed company that owns the Starlink satellite internet network, agreed to acquire wireless spectrum from EchoStar Corp for about US$17 billion ($21.8 billion), allowing Charlie Ergen’s beleaguered telecommunications company to resolve an overhanging regulatory probe and pay down debt.
SpaceX is buying EchoStar’s AWS-4 and H-block spectrum licenses designated for satellite and mobile communications according to a statement Monday, confirming an earlier Bloomberg News report. It will pay as much as US$8.5 billion in cash and up to US$8.5 billion in SpaceX stock. SpaceX has also agreed to fund a total of about US$2 billion in cash interest payments on EchoStar debt through November 2027.
