Citi says DirecTV-Dish merger has ‘a high degree of industrial logic’
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- Citi Research weighed in on recent media reports that indicated DirecTV and Dish are in discussions to merge their satellite video businesses.
- Citi thinks there is still a high degree of industrial logic to merge the two as they try to navigate “the secular erosion of linear video subscriptions” and improve scale to offer a streaming alternative.
- The Bloomberg report over the weekend comes after their last year’s report that said AT&T is considering options for its stake in DTV.
- Citi believes AT&T will look to maximize value from its DTV ownership. Also, there may be an alternative scenario for Dish to use spectrum as currency to acquire AT&T’s stake in the DTV business that could create an accretive financial scenario for EchoStar equity holders.