* SoftBank Chief says no need to improve Sprint offer
* Son plans trip to woo long-term Sprint shareholders
* Son may be open to Dish spectrum hosting deal
* Sees debt from Dish offer hurting Sprint's outlook
By Mari Saito and Sinead Carew
TOKYO/NEW YORK, April 30 SoftBank Corp
President Masayoshi Son came out swinging on Tuesday against
Dish Network Corp's rival bid for Sprint Nextel Corp
, saying the satellite TV company would cripple Sprint with
debt and was ill-prepared to run a wireless service.
Billionaire Son said there would be no need for SoftBank to
sweeten its bid and he dismissed Dish's $25.5 billion offer as
"incomplete and illusory." He argued his $20.1 billion offer
would ultimately be better value for Sprint shareholders.
Son, who plans to make a U.S. trip to plead his case with
Sprint shareholders, calculated that SoftBank's bid is worth 21
percent more than the Dish offer after items, including
synergies, debt, break-up fees and the timing for a deal close
are taken into account.
"Our price offer is better than theirs. Our timing is one
year quicker at least. Our leverage is much more healthy," Son
told a packed news conference in Tokyo. "(Their) financing is
uncommitted. We are committed."
The two sides differ substantially on what their offers are
actually worth. Son calculated his bid is worth $7.65 per share,
against what he said was a Dish offer value of $6.31 per share.
Dish Chairman Charlie Ergen has calculated the value of his deal
is $7 per share, in comparison with what Dish says is a $6.22
per share deal from SoftBank.
Two big Sprint shareholders, Paulson & Co and Omega
Advisors, have publicly said that the Dish offer looks better
Dish, which is aiming to tap Sprint's wireless network to
offer mobile video services and to combine their spectrum
holdings, made its offer earlier this month. SoftBank placed its
bid last October.
A special committee of Sprint's board is currently reviewing
the Dish offer and has asked for more information.
Dish responded to SoftBank's attack on Tuesday with the
argument that its offer provided a higher upfront price, as well
as the possibility for better savings and growth opportunities
because it is a U.S.-based company.
"We remain confident that the Sprint Board will share our
view that the Dish proposal is superior by offering Sprint
shareholders greater value with a higher price and more cash,"
But Son argued that Dish would be a weaker partner for
Sprint because it has no history in wireless. He also dismissed
Dish's plan to provide video to Sprint customers, as the
operator urgently needs to beef up its network first.
"Charlie has no expertise in the mobile industry," the
executive told Reuters in a telephone interview in which he
described the U.S. media veteran as an "amateur" in mobile.
Son said SoftBank was preparing a secret weapon of sorts to
help change Sprint, "a very innovative product, innovative
service that no other carriers in the world are preparing." He
declined to elaborate on what that might be.
Son also told Reuters that a combined Sprint and Dish would
"suffer for quite some time" from a heavy debt load that would
arise from Dish's need to raise more than $9 billion in capital
markets to fund its bid.
Neil Juggins, a Hong Kong-based regional telecommunications
analyst at Societe Generale affiliate JI Asia, said Son raised
important points, such as the regulatory checks that would be
required due to the combined spectrum held by Dish and Sprint.
"He has given a rebuttal that now will be pitched to
shareholders," Juggins said.
While SoftBank has said it could close its deal on July 1,
analysts say a Dish deal would likely drag into 2014 because of
the regulatory review process.
In a dig at Dish's Ergen, Son said SoftBank had built up
strong partnerships with leading U.S. technology companies such
as Google Inc and Intel Corp, contrasting that
with what he said were Dish's "ugly" litigation battles.
SoftBank secured support for the deal from Intel Chief
Executive Paul Otellini, who wrote in a letter to the Federal
Communications Commission that Son's vision of building a
high-speed U.S. network was compelling.
Son also played down U.S. national security concerns over
SoftBank's use of Chinese telecoms equipment, which could be the
biggest potential regulatory hurdle facing the deal. In
regulatory filings, Dish has portrayed those relationships as
something that should seriously concern U.S. officials.
But Son said he had made commitments not to use equipment
from China's Huawei Technologies Co Ltd and ZTE Corp
in the United States and that U.S. regulatory
approval was proceeding smoothly.
He made his case as SoftBank reported a record 745 billion
yen ($7.59 billion) operating profit for the year to March 31,
up 10 percent from the previous year. He forecast a further rise
this year to between 800 billion and 900 billion yen.
SoftBank's shares closed 1.2 percent higher on Tuesday,
before Son's comments, compared with a 0.2 percent dip in
Tokyo's benchmark Nikkei average. They are up 67 percent
since the Sprint bid, in line with the Nikkei's surge.
Son dismissed the possibility of a joint purchase of Sprint
by Dish and SoftBank, saying it was not necessary and that it
might be difficult to work together.
But if SoftBank closes its deal, Son said he would be open
to discussing a spectrum hosting agreement with Ergen, where
Dish would pay to use Sprint's network to offer its own service
using its own spectrum as well.
"I'm open to any potential business, but first we have to
own Sprint," he said.
Son also dismissed concerns that shareholders of Sprint's
majority owned venture, Clearwire Corp, might vote
against Sprint's agreement to buy the rest of Clearwire for
$2.97 per share at a special meeting on May 21.
If that deal is voted down by minority shareholders, Sprint
might not need to buy their shares anyway as it would already
have roughly 68 percent ownership and board approval because of
support from strategic investors.
Sprint has set June 12 as the tentative date for a special
meeting for shareholders to vote on the proposed deal with
SoftBank. Sprint shares were down 1 percent at $7.06 in
afternoon trading on the New York Stock Exchange.