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WSJ: EchoStar in sales talks with Liberty Media and Murdoch

Mon, 01/20/2003 - 7:00pm
Staff

EchoStar Communications Corp. is in talks to sell to News Corp. chief Rupert Murdoch or Dr. John Malone's Liberty Media Corp., the Wall Street Journal reported Tuesday.

The paper reported that EchoStar Chairman Charlie Ergen has been in discussions with both parties, but that those talks have not reached a stage of formal negotiations. Late last year, federal regulators blocked EchoStar from acquiring Hughes Electronics Corp. and its DirecTV unit.

Salomon Smith Barney, in a research note, said News Corp. and Liberty Media "would naturally have interest in combining operations with DISH, given that both have expressed interest in acquiring DirecTV."

The firm warned, though, that a deal to acquire EchoStar would require "considerable stock issuance." Although a Liberty-News Corp. deal for the Hughes units might be more attractive at first glance, Salomon Smith Barney noted that EchoStar is perceived to be a well-run company and that it does not come with the "baggage of other assets," including satellite service provider PanAmSat.

At the very least, any potential acquisition discussions with EchoStar could improve Liberty and News Corp.'s negotiating leverage with Hughes, Salomon Smith Barney wrote in its analysis.

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