This is an ARCHIVED page CHECK dateline

St. Louis Business & Technology News www.slfp.com/SLFPBIZp.htm "When you think Saint Louis, think Saint Louis Front Page," a weekly publication covering the news and events in the greater St. Louis area. Saint Louis News Saint Louis CitySide Entertainment Southwest, IL News Fairview Heights,IL St. Louis Restaurants Downtown Map America's Center Busch Stadium Gateway Arch Savvis Center Laclede's Landing Old Courthouse Union Station Metropolitan Map Casinos Central West End Clayton Grand Center Grant's Farm Forest Park MO Botanical Garden Soulard St. Charles, MO West Port Plaza Shopping Guide Transportation Weather Related Archived News: Lockheed Martin JSF Team Wins $200b Defense Contract HP and Compaq Merger Creates $87 Billion Company Web Developers Take on Challenge of Redesigning Its Web Site Pronettsolutions Finds Niche in Developing Wireless Applications G. A. Sullivan Showcases Smart Tags Solutions at the Microsoft Office XP Launch in St. Louis 2001 ITEC Provides Technology Solutions for St. Louis Businesses Review of MacOS X - Welcome to the future my friends... New Sleek Palm Pilots Add Mobile Connectivity and Vibrant Color Smartphone Combines Voice, Text and Web Access 'Bounce' Transmitted Via Fiber Report From Fall Internet World 2000 SmarTrip Revolutionizes Mass Transit Kiel Becomes Savvis Center Firestone Tire Recall TCS Provides IT Solutions AT&T & Charter End Talk BIO Governor of the Year C. Rallo Builds Data Centers Digimarc MediaBridge Reader Spring Internet World 2000 e-License Plates in CA Book Flights via Mobile Net Access at Airports Net Shoppers Want It All Grocery Shopping Via TV Ultimate Internet Phone Wireless Banking On Palm VII

GM Chief Executive Officer Rick Wagoner, left, EchoStar Chief Executive Officer Charles Ergen, center, Hughes Chief Executive Officer Jack Shaw, right, shake hands as they announce the signing of definitive agreements that provide for the spin-off of Hughes from GM and the merger of Hughes with EchoStar, Monday, October 29, 2001, in New York. (Robin Weiner/WirePix) GM's Hughes Electronics to Merge With EchoStar Communications NEW YORK, (Newstream), October 29, 2001 - General Motors Corp. and its subsidiary Hughes Electronics together with EchoStar Communications Corporation have agreed to merge using the EchoStar name and adopting the DIRECTV brand for its services and related products. If approved, the merger, worth $26 billion, would create the nation's second-largest pay television platform with more than 16.7 million subscribers, of which 1.8 million subscribers are National Rural Telecommunications Cooperative (NRTC) and affiliates, and 14.9 million subscribers are owned-and-operated by the combined company. Cable TV companies presently control more than 80 percent of the U.S. pay television market, while a combined EchoStar-Hughes would provide service to about 17 percent of the market. "This transaction provides significant benefits to Hughes, EchoStar, millions of present and future DIRECTV customers, and shareholders of both GM and EchoStar," said GM President and Chief Executive Officer Rick Wagoner. "We've said all along that we wanted to structure an agreement that would provide continued strong growth at Hughes and maximum value for both GM and GM Class H shareholders. This transaction achieves these objectives." EchoStar Chief Executive Officer Charles Ergen, second left, answers questions with, from left, GM Chief Executive Officer Rick Wagoner, Hughes Chief Executive Officer Jack Shaw, DIRECTV Chief Executive Officer Eddy Hartenstein, GM Vice Chairman John Devine as they announce the signing of definitive agreements that provide for the spin-off of Hughes from GM and the merger of Hughes with EchoStar, Monday, October 29, 2001, in New York. (Robin Weiner/WirePix) Strong Growth Prospects and Significant Synergies "This is an extremely compelling combination for GM, GMH and EchoStar shareholders," EchoStar Chief Executive Officer Charles Ergen said. "The combination of EchoStar and Hughes is expected to generate very substantial synergies utilizing the advantages of direct-broadcast satellite television, cost savings from the elimination of costly duplicate satellite bandwidth and infrastructure, and strong management offering more effective fundamental business practices." "The new company would also have enhanced scale to compete more effectively against the dominant U.S. cable and broadband providers - a critical factor given increasing consolidation in the cable industry," noted Ergen. "U.S. consumers also would benefit from the combined company's ability to increase significantly the number of markets served with local channels via satellite, provide additional channel offerings, increase high-definition TV (HDTV) offerings and accelerate the introduction of next-generation high-speed Internet services," Ergen continued. "Together, EchoStar's DISH Network and Hughes' DIRECTV also can provide a range of services that would bridge the 'digital divide' - providing high-speed broadband solutions to consumers and businesses. Importantly, these services would be available in rural areas otherwise far from the information superhighway at rates which the company is prepared to assure regulators would be competitive," Ergen said. The transaction is expected to require approximately $5.5 billion of total financing, which EchoStar expects to fund in the capital markets prior to closing. Completion of this financing has been backstopped by a bridge commitment of approximately $2.75 billion from Deutsche Bank, and a bridge commitment of approximately $2.75 billion from General Motors, the latter of which the parties plan to replace with a commitment from one or more other leading financial institutions in the near future. The GM bridge commitment is secured by a pledge of $2.75 billion of EchoStar stock held by a trust controlled by EchoStar Chairman and Chief Executive Officer Charles Ergen. The new company, which would retain the EchoStar name but would use the DIRECTV brand for consumer offerings, would be based in Littleton, Colo., and would employ approximately 20,000 people and serve more than approximately 14.9 million direct-broadcast satellite TV customers. EchoStar and Hughes have pledged that the merger would not cause disruption of service or additional expense to existing customers of either DIRECTV or DISH Network service. The new EchoStar would be led by Ergen as chairman and chief executive officer. The board of directors would consist of nine members, five of whom would be independent directors. The spin-off of Hughes from GM would result in current holders of Class H common stock receiving one share of new Hughes Class C common stock in exchange for each share of Class H stock held prior to the spin-off. The merger of Hughes and EchoStar would result in Hughes being the surviving entity and taking the name EchoStar Communications Corp. Holders of Class A EchoStar common stock prior to the merger would receive 1.3699 shares of the new EchoStar in exchange for each share of Class A EchoStar common stock held prior to the merger. Based on the closing price of EchoStar common stock of $25.26 on Oct. 26, 2001, the transaction would provide a value of approximately $18.44 per GMH share, representing a 20-percent premium. As of Oct. 26, 2001, the implied market capitalization of Hughes was approximately $21.3 billion and the market capitalization of EchoStar was approximately $12.1 billion. "Hughes and its operating companies would be well positioned to thrive as part of this merged company," said Jack A. Shaw, chief executive officer of Hughes. HUGHES is the world's leading provider of digital television entertainment, broadband services, satellite-based private business networks and global video and data broadcasting. "DIRECTV would enjoy significant cost efficiencies and better use of its assets. Hughes Network Systems would play a key strategic part in the growth of satellite-delivered broadband. PanAmSat would have continued growth opportunities. And DIRECTV Latin America would benefit from the synergies of the larger combined company," Shaw said. A transition team will be made up of Shaw and DIRECTV Chairman and CEO Eddy Hartenstein from Hughes, as well as Ergen and EchoStar President Michael Dugan. Return to St. Louis Front Page The Saint Louis Front Page is owned and maintained by the Moore Design Group for the sole purpose of disseminating news and information about the Metropolitan Saint Louis area. Text or graphics may not be copied, rewritten or distributed in any manner whatsoever without written permission. For more information, contact editor@slfp.com All rights reserved world wide © 1996 - 2008 Moore Design Group .