LOS ANGELES, Calif. – Shares of satellite TV companies Dish and DirecTV surged in midday trading Wednesday after a report said that Dish Chairman Charlie Ergen had contacted DirecTV CEO Mike White about merging.
Bloomberg News reported Ergen initiated the discussion in response to Comcast Corp.’s pending $45 billion acquisition of Time Warner Cable Inc., which was announced last month. The news service cited several unnamed sources.
Dish Network Corp. spokesman Bob Toevs declined to comment. DirecTV spokesman Robert Mercer said the company doesn’t comment on speculation.
The companies last tried to merge more than a decade ago, but the Federal Communications Commission killed the deal in 2002 because it would eliminate competition. While Ergen has long supported the two companies coming together, White has been less vocal about the matter.
White told an investors conference earlier this month, however, that the video industry has changed in the last decade, gotten more competitive because of the entry of telecommunications companies, and expects it to change more in the next five years.
Dish shares rose $3.67, or 6.3 per cent, to $62.09, while DirecTV shares rose $4.17, or 5.7 per cent, to $77.34.
Dish is based in Englewood, Colo., and DirecTV is based in El Segundo, Calif.