EchoStar made its bid for DirecTV last night in a letter to the board of Hughes parent company, General Motors.
EchoStar is the second-largest satellite television company in the US after DirecTV. GM had already turned an earlier proposal from EchoStar down last month, primarily because of the anti-trust investigation that a merger between the two US satellite TV companies would bring.
Rupert Murdoch's News Corporation has been in talks with DirecTV's parent, Hughes, for months and it was believed to have been a done deal, with agreement having been reached on both sides.
Under the terms of EchoStar's latest proposal, it is offering 0.75 cents for each share of Hughes -- an 18% premium. It would also assume $1.9bn (£1.3bn) of Hughes' debt.
A merger between EchoStar and DirecTV could have major plus points, not least the shared costs the two could save. EchoStar has around 6m subscribers and DirecTV has around 10m. Together, they would present a more serious challenge to the entrenched and powerful cable TV networks in the US.
For Murdoch, the deal was the last piece in the puzzle. He planned to merge DirecTV with Sky Global, his satellite holding company. There it would join BSkyB and Star TV in Asia. Murdoch did try in the Nineties to build an American version of Sky, ASkyB, but this bid failed. DirecTV gives him his US base which, with the experience of Sky in the UK, could help him quickly grow the business.
Analysts, however, expect the EchoStar bid to fail and the deal with News Corp to go ahead as planned.
Ever hopeful, EchoStar chairman Charlie Ergen said last night he believes the proposal has "a very good chance" of getting the go-ahead from anti-trust officials.