Word: ergener
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...Charlie Ergen made his first run on the satellite-television market in the '80s, and he did it by truck. Ergen, with his future wife Candy and a poker buddy, Jim DeFranco, drove one of their two satellite dishes to Colorado, hoping his fledgling service would score big in a land of tall mountains and bad TV reception. A stiff wind blew their trailer into a ditch, ruining the dish and leaving them with only one. As it turned out, one dish was enough. Ergen used it to build EchoStar, now the nation's second largest satellite-TV company...
...Ergen isn't hauling dishes anymore, but he is still the scrappiest guy in satellite TV. Last week he made a $32 billion all-stock bid for DirecTV, the largest satellite company in the U.S. The offer puts Ergen in an uphill battle against Australian-born media mogul Rupert Murdoch, who was on the brink of clinching his own deal for DirecTV. If Ergen outmaneuvers Murdoch in the battle that's likely to unfold in the next few weeks, he will control most of the nation's satellite sets. If he loses, the move--like a well-executed bluff...
...been an elusive prize for Murdoch. Hughes chairman Michael Smith long spurned his advances, an impediment that disappeared in May when Smith did: he was recently replaced by Harry Pearce, a top GM executive seen as sympathetic to Murdoch's bid. Just when the deal seemed imminent, though, Ergen made his play...
Murdoch has several factors in his favor, beyond possibly friendly management at Hughes. With two deep-pocketed backers behind him, Microsoft and Liberty Cable's John Malone, Murdoch could hand over as much as $7 billion in cash. In mergers and acquisitions, cash is king. (Ergen has said he would consider adding some cash.) Most significant, there's considerable skepticism in the industry that antitrust regulators would let Ergen combine the nation's two largest satellite companies...
...Murdoch-approved descrambling technology. Some industry observers contend the technology issue is only a smoke screen for other problems faced by the venture. The deal was thrown further into doubt late last week when Preston Padden, Murdoch's top satellite executive, resigned, reportedly after clashing with EchoStar chairman Charles Ergen over control of the venture. "The EchoStar deal left me without a real job," Padden told TIME. "I have nothing but respect and affection for Mr. Murdoch, but I am out of here...