DirecTV announced Monday it is buying Echostar’s video distribution business, Dish TV and Sling TV, for less than a cup of coffee and the assumption of the Englewood-based company’s $9.7 billion debt, according to a statement.

Although the transaction is still subject to various closing conditions, the deal could provide a key lifeline for EchoStar, which has reportedly faced the possibility of bankruptcy as it continues to burn through cash and see losses pile up.

In a recent securities filing, EchoStar disclosed that it had just $521 million in “cash on hand.” The company forecast negative cash flows for the remainder of the year while also pointing to major looming debt payments, with more than $1.98 billion of debt set to mature in November.

By shedding Dish TV, EchoStar can focus its efforts elsewhere — like its wireless carrier Boost Mobile.

The prospect of a DirecTV-Dish combo has long been rumored, with headlines about reported talks popping up over the years. And the two almost merged more than two decades ago — but the Federal Communications Commission blocked their owners’ then-$18.5 billion deal, citing antitrust concerns.

The pay-for-TV market has shifted significantly since. As more and more consumers tune into online streaming giants, demand for more traditional satellite continues to shrink. And, although high-profile acquisitions have proven to be particularly tough under the Biden-Harris administration, that may make regulators more inclined to approve DirecTV and Dish’s pairing this time around.

“DirecTV operates in a highly competitive video distribution industry,” said DirecTV CEO Bill Morrow in a news release. “With greater scale, we expect a combined DirecTV and Dish will be better able to work with programmers to realize our vision for the future of TV, which is to aggregate, curate, and distribute content tailored to customers’ interests, and to be better positioned to realize operating efficiencies while creating value for customers through additional investment.”

Dish TV, one of Denver’s largest tech employers with more than 4,000 team members in local area according to the company’s website, trimmed more than 200 from its local payroll this year and more than 500 in 2023.

Users on Dish TV’s Facebook page reacted to this morning’s news with concerns of how the sale will affect local viewing options, future consumer pricing and  complicate customer service during the transition.

The Denver Gazette reached out several times to DirecTV and Corporate Communications Director Ted Wietecha for comment, but none was received by press time Monday.

“This agreement is in the best interests of EchoStar’s customers, shareholders, bondholders, employees, and partners,” Hamid Akhavan, EchoStar president and chief executive officer, said in the release. “With an improved financial profile, we will be better positioned to continue enhancing and deploying our nationwide 5G Open RAN wireless network. This will provide U.S. wireless consumers with more choices and help to drive innovation at a faster pace. We expect Dish and EchoStar bondholders to benefit from two companies with stronger financial profiles and more sustainable capital structures.”

“We are playing to win in the wireless business. there’s no doubt about it,” Akhavan said during a conference call, adding that the company may need to seek additional funding and financing in the future to achieve its goals.

Shares of EchoStar fell more than 14% in Monday midday trading.

The DirecTV and Dish deal is targeted to close in 2025’s fourth quarter. But it is contingent on several factors, including regulatory approvals and bondholders writing off nearly $1.6 billion in debt related to Dish.

The combined company will be based in El Segundo, California — possibly not a good sign for metro Denver area based employees.

“We believe regulatory approval is likely to be greater than 50% given the opportunity for the combined company to improve its competitiveness to offer a range of linear video packages as well as to take a more aggressive stance on offering a live streaming video product,” Michael Rollins of Citi Investment Research wrote in a note to clients.

But the analyst added that there’s still significant uncertainty related to whether or not the Federal Communications Commission, Department of Justice and other possible regulators give the necessary approvals, based on previous talks with company management and industry experts over the last few years.

Shortly before DirecTV made its announcement, AT&T said it was selling its remaining stake in DirecTV to private equity firm TPG in a deal valued at about $7.6 billion.

The move ends the communication giant’s remaining ties to the entertainment industry.

The Associated Press contributed to this story.