The tortuous wranglings over the future of DirecTV – America’s biggest satellite TV firm – continue with the news that Charlie Ergen, chairman of rival broadcaster EchoStar, has approached AOL Time Warner to try to muster support for a takeover bid.
Ergen’s efforts are designed to thwart Rupert Murdoch’s NewsCorp, whose protracted attempts to purchase DirecTV seem increasingly likely to succeed [WAMN: 29-May-01].
The EchoStar chairman is keen for AOL – which has refused to give actual financial support to his bid, probably for fear of regulatory opposition – to back his offer vocally, encouraging other potential investors to provide funds.
Should Ergen succeed in forging a coalition of investors – and it remains a big if – he will face intense regulatory scrutiny over his plans to combine the two leading US satellite TV providers.
News source: Financial Times