Some Dish Network Corp. creditors are examining legal options including sending a default notice to the company after it moved prized assets out of bondholders’ reach, Bloomberg News reported. The discussions come after the company’s bonds plummeted — in at least one case to a record low — on its decision to shuffle valuable spectrum licenses and television customers into new legal entities. Such moves are often precursors to rescue money deals that hurt existing creditors. The creditors are considering whether Dish’s asset transfers run afoul of rules governing the company’s debt contracts, giving rise to a technical default. The deliberations are in their early stages and no decision has been made. Last week, the Englewood, Colorado-based company transferred a handful of wireless spectrum licenses into a new legal entity under EchoStar, and freed a new unit holding 3 million television subscribers from debt covenants. Dish has struggled to transition from a legacy pay-TV business into a wireless communication company, saddling itself with more than $20 billion of debt in the process and crimping its access to credit markets. Its recent merger with EchoStar, the satellite network it spun off in 2008, is expected to buy time for its 5G buildout, but the company still must address looming debt maturities.
