EchoStar Corporation announced this week that it has secured $5.2 billion in capital to invest in its nationwide Open RAN 5G network.

The company, which has had its financial struggles and openly feared for its future this year, also completed a transaction worth $5bn to support its debt restructuring.

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– Wikimedia Commons

In August, when the company announced its earnings for Q2, Paul Orban, EchoStar CFO and EVP, warned that EchoStar was facing $2bn in debt maturing on 24 November. He noted that the company didn't have the funds to pay off the debt.

However, this week the company said it was able to put its debt maturities in a much stronger position.

"We are optimistic for the bright future ahead following the completion of these transactions that position our business for success," said Hamid Akhavan, president and CEO, EchoStar Corporation.

"The significant additional capital raised by our business, together with our successful efforts to improve our debt maturity profile, will allow us to continue to invest in our nationwide Open RAN 5G network, and secure profitable customer acquisition and retention. We paved the way for EchoStar to successfully compete in the US wireless market, and firmly believe customers will continue to realize the benefit of our state-of-the-art, modern network."

The cash boost for EchoStar's 5G network comes after the company had to scale back its investment in the rollout.

Despite scaling back, EchoStar reported 5G network revenue of $43.2 million, up from $29.9m last year.

Dish previously hit its 5G coverage target set by the Federal Communications Commission (FCC) last year, to deliver 5G service to 70 percent of the US population.

For the quarter, Dish added 62,000 wireless subscribers, taking its total number to 6.98 million.

Overall for Q3, EchoStar posted revenue of $3.9bn, down five percent YoY, and posted a net loss of $141.8m compared to $133.3m the year prior.

DirecTV deal in jeopardy

Despite the more upbeat earnings report, a group of Dish bondholders have this week rejected a proposed debt-exchange offer from DirecTV.

The proposed $1 sale to DirecTV, which includes the sale of Dish's Dish DBS pay-TV business as well as Dish and Sling TV, would see DirecTV take on around $9.75 billion of Dish's debt.

For the deal to be pushed ahead, Dish DBS debtholders had to agree to exchange their debt for new debt in the merged entity at a discounted rate, shaving $1.57bn on the debt.

"This group has roundly and resolutely rejected the latest proposed exchange offer," stated the letter from the committee, according to Bloomberg.

"While we are hopeful that the DBS exchange will be successful, we now have a more robust foundation to operate and grow EchoStar's business independent of the exchange outcome," added Akhavan during the company's earnings call.

The importance of the deal is key to EchoStar's plans to reduce its overall debt, which sits at around $20bn. EchoStar was spun out from Dish back in 2008.

The split saw Dish retain its TV business while it shed the satellite infrastructure that beamed content into them. Both companies are owned by billionaire Charles Ergen.