Hughes and EchoStar Terminate Proposed Merger Agreement;
EchoStar Pays Hughes $600 million; Hughes to Keep PanAmSat Interest
LITTLETON, Colo., and DETROIT, Dec. 10 -- General Motors
Corporation, its subsidiary, Hughes Electronics Corporation (NYSE: GM, GMH),
and EchoStar Communications Corporation (Nasdaq: DISH) today announced the
companies have reached a settlement to terminate the proposed merger of Hughes
and EchoStar, effective immediately.
Under terms of the settlement, EchoStar has paid to Hughes $600 million in
cash, and Hughes will retain its 81 percent ownership position in PanAmSat
(Nasdaq: SPOT).
The companies reached this settlement because the proposed merger could
not be completed within the time allowed by the merger agreement. This was
due to action taken by the Department of Justice, 23 states, the District of
Columbia and Puerto Rico to block the merger as well as the Federal
Communications Commission's decision to send the merger application to a
hearing.
'We continue to believe that the proposed merger would have been a victory
for consumers nationwide, and for our shareholders. We worked hard on it to
get the required regulatory approval and are disappointed that we were not
able to complete the merger,' said Hughes President and Chief Executive
Officer Jack A. Shaw. 'However, since the merger couldn't be completed, we
concluded that this settlement is the best alternative for Hughes and places
us in the best position to move ahead with our business.'
'We are appreciative of all the support we received and the opportunity to
present the merger proposal to regulators. Obviously, we are disappointed in
the final outcome. However, EchoStar will continue to seek alternative,
innovative ways to provide competition to the rapidly consolidating cable
industry and to provide more choices for all consumers,' said EchoStar
Chairman and Chief Executive Officer Charles Ergen.
As a result of the merger termination, EchoStar will take an approximate
$700 million write off in the fourth quarter for the merger breakup fee and
other related merger expenses.
HUGHES, a world-leading provider of digital television entertainment,
broadband services, satellite-based private business networks, and global
video and data broadcasting, is a unit of General Motors Corporation. The
earnings of HUGHES are used to calculate the earnings attributable to the
General Motors Class H common stock (NYSE: GMH).
General Motors (NYSE: GM), the world's largest vehicle manufacturer,
designs, builds and markets cars and trucks worldwide, and has been the global
automotive sales leader since 1931. GM employs about 355,000 people around
the world. More GM information can be found at www.gm.com .
EchoStar Communications Corporation and its DISH Network satellite TV
system provide over 500 channels of digital video and CD-quality audio
programming as well as advanced satellite TV receiver hardware and
installation nationwide. EchoStar is included in the Nasdaq-100 Index (NDX)
which contains the largest non-financial companies on the Nasdaq Stock Market.
Visit EchoStar's Investor Relations website at www.echostar.com . DISH
Network currently serves 8 million customers in the United States. DISH
Network is located on the Internet at www.dishnetwork.com .
SOURCE General Motors Corporation
-0- 12/10/2002
/NOTE TO EDITORS: For additional media information, visit
http://media.gm.com ./
/CONTACT: Toni Simonetti of GM, +1-212-418-6380; George Jamison of
Hughes, +1-310-662-9986; or Marc Lumpkin of EchoStar, +1-303-723-2020/
/Web site: http://www.dishnetwork.com /
/Web site: http://www.echostar.com /
/Web site: http://media.gm.com /
/Web site: http://www.gm.com /
(GM GMH DISH SPOT)
-END-
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