Dish Network Corp., which is sitting on a vast trove of wireless spectrum, fell the most in a decade on renewed concern that T-Mobile US Inc.’s merger with Sprint Corp. will remove a partner.
After U.S. Federal Communications Commission Chairman Ajit Pai said he would recommend approval of the $26.5 billion Sprint/T-Mobile merger, investors took it as a sign that the deal was in its home stretch.
For Dish shareholders, that’s not welcome news. They’ve been waiting for the satellite broadcaster to team up with a carrier, letting Dish use a collection of airwaves worth tens of billions of dollars.
The approval of the Sprint/T-Mobile transaction “likely significantly pushes back the timing for a potential Dish spectrum deal materially,” Jeffrey Wlodarczak, an analyst at Pivotal Research Group, said in a report.
Meanwhile, Dish said Monday that it will buy EchoStar Corp.’s broadcast satellite service business in an all-stock deal valued at about $800 million. The two companies, both founded by Charlie Ergen, already work closely together and the deal isn’t seen as a game changer for Dish.
Dish shares tumbled as much as 12 percent, marking their worst intraday decline since March 2009. The stock had been up 41 percent this year through the end of last week.
Ergen, who serves as Dish’s chairman, disappointed investors last year when he said that no network deals were imminent. At the time, the executive admitted that staying solo wouldn’t work.
“We won’t be successful as a lone wolf out there,” he said. “We’re not that good.”