Dish Network stock jumps amid talk of AT&T bid
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A report that AT&T Inc. might make a bid for Dish Network Corp. caused Dish’s stock price to climb Thursday.
Jonathan Chaplin, an analyst with Credit Suisse Group, said that Dish’s wireless-spectrum assets -- which could allow a partnering phone carrier to offer a “triple play bundle of video, voice and data” services -- are key to its appeal.
And as part of AT&T, Dish would “almost certainly” see a boost in subscribers while likely reducing installation and customer service costs, Chaplin wrote. AT&T would be able to negotiate lower content and programming costs for its U-Verse television and Internet business by going through existing Dish contracts.
“The strategic value of spectrum speaks for itself –- spectrum is in limited supply,” Chaplin wrote. “AT&T has borne painful witness to the impact of rising smart phone penetration on its wireless network.”
Dish shares jumped as high as $24 on Thursday, 8.2% above Wednesday’s close. They ended the day’s regular session at $23.49, up $1.31, while AT&T gained 27 cents to $28.24.
Several years ago, Dish turned down an offer from AT&T, Chaplin wrote. But now that AT&T is satisfied with the government’s position on net neutrality regulations, it makes sense for the company to try again. A deal with Dish, one of the country’s largest satellite television providers, would likely require approval from both the FCC and the Department of Justice.
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-- Tiffany Hsu