Dish abandons Sprint bid for now to focus on Clearwire

NEW YORK Tue Jun 18, 2013 7:50pm EDT

Workers build a booth for Dish, a satellite TV provider, as they prepare for the International CES show at the Las Vegas Convention Center in Las Vegas, Nevada January 4, 2013. REUTERS/Steve Marcus

Workers build a booth for Dish, a satellite TV provider, as they prepare for the International CES show at the Las Vegas Convention Center in Las Vegas, Nevada January 4, 2013.

Credit: Reuters/Steve Marcus

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NEW YORK (Reuters) - Dish Network Corp said it would not make a new offer to buy No. 3 U.S. wireless provider Sprint Nextel in time for a Tuesday deadline and will instead focus on its tender offer for Clearwire Corp.

The decision may be good news for Japan's SoftBank Corp, which is also trying to buy Sprint.

Satellite TV provider Dish said in a statement that it was not practical for it to submit a revised offer by the June 18 deadline imposed by Sprint even though it "continues to see strategic value in a merger with Sprint."

Dish said it would consider its options with respect to Sprint without providing any more details.

This was the latest turn in a take-over battle that started on April 15 when Dish - led by its chairman and founder, Charlie Ergen - offered to buy Sprint for $25.5 billion in a challenge to SoftBank.

Known for his aggressive tactics in deal-making, Ergen is looking to expand into the wireless market as its traditional pay-TV business has been maturing.

Ergen is also fighting with Sprint to buy out the minority shareholders of Clearwire Corp, which is already majority owned by Sprint.

Clearwire's board last week recommended that its shareholders vote against Sprint's $3.40 per share offer at a special meeting scheduled for June 24 and instead urged them to accept Dish's tender offer to buy Clearwire shares for $4.40 each.

SoftBank raised its bid for Sprint on June 10 to $21.6 billion from its previous offer of $20.1 billion. The latest deal would leave SoftBank with 78 percent ownership of Sprint compared with a 70 percent stake under its earlier offer.

Sprint accepted the latest SoftBank offer as it provides shareholders with more cash than the previous agreement. Sprint shareholders are due to vote on Sprint's agreement with SoftBank at a June 25 meeting.

(Reporting by Greg Roumeliotis and Sinead Carew in New York; Editing by Bernard Orr and Diane Craft)

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Comments (2)
nycnikato wrote:
This is very very wise. This allows Dish to put their full financial force on the clearwire deal. It has been my contention that Clearwire is actually the jewel, not Sprint. Clearwire has been severelty undervalued relative to their capabilities nd nationwide reach. dish has finally realized this. I would;t be surprised if Charlie were willing to put 15 to 20 billion on Clearwire.

Jun 18, 2013 8:02pm EDT  --  Report as abuse
MariusT wrote:
So, Softbank was flirting with buying T-Mobile. Now it is possible that no one will buy Sprint. As Sprint’s history is plagued with worst-case scenarios, I wouldn’t discount that from happening at all. Maybe Dish goes through with the Clearwire purchase and Sprint sees some money from the sale, but that nowhere near what Sprint needs to fund their infrastructure changes for LTE.

The only upside is that Sprint Business customers (using MPLS) don’t have to groan anymore about Echostar making their customer support even more abysmal.

Jun 19, 2013 10:32am EDT  --  Report as abuse
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