By Alina Selyukh
WASHINGTON, July 3 U.S. regulators on Wednesday
collected the final vote to approve the merger of Sprint Nextel
Corp and SoftBank Corp, sources familiar with the
situation said, clearing the last hurdle in the Japanese
company's drawn-out battle to take control of the No. 3 U.S.
All three Federal Communications Commission members voted in
favor of that merger as well as Sprint's related bid to buy out
the shares of wireless company Clearwire Corp that it
does not already own, said the sources who spoke anonymously
because the approval has not yet been announced publicly.
In filings with the FCC, Sprint, Clearwire and SoftBank had
said they hoped to close both deals on July 8 or 9.
SoftBank's $21.6 billion deal to buy 78 percent of Sprint
would mark the largest-ever overseas acquisition by a Japanese
company as hard-driving billionaire SoftBank founder Masayoshi
Son seeks to expand beyond the mature Japanese cellphone market.
Sprint needs investment from SoftBank to help it pay for a
network upgrade and step up competition with No. 1 and No. 2
rival providers AT&T Inc and Verizon Communications Inc.
. The money would also help pay for the Clearwire buyout.
Clearwire, in which Sprint already owns a majority stake, is
an important part of SoftBank's interest in Sprint because
Clearwire holds a large amount of wireless airwaves, or
spectrum, to help Sprint compete against its bigger rivals.
The FCC's review, running more than 70 pages long, focused
on whether the two related deals were in the U.S. public
interest and was the last regulatory hurdle for SoftBank after
it received approvals from U.S. antitrust and national security
regulators as well as Sprint shareholders.
FCC, Sprint and Clearwire spokesmen declined to comment.
SoftBank could not be immediately reached for comment.
Clearwire minority shareholders are scheduled to vote on
Sprint's buyout offer on July 8.
DELAY OVER SPECTRUM LANGUAGE
FCC Acting Chairwoman Mignon Clyburn and Commissioner
Jessica Rosenworcel cast their approval votes last week. The
required third and final vote from Commissioner Ajit Pai was
delayed until Wednesday by adjustments to the wording used to
address Sprint's ownership of airwaves, according to a source
familiar with the negotiations.
Verizon and others had asked the FCC to use its deal review
to weigh how it calculates Sprint's airwaves toward the
so-called spectrum screen, which ensures fair allocation of
spectrum licenses among competing providers.
Because of Sprint's majority ownership in Clearwire, the FCC
had already attributed its spectrum to Sprint for screen
purposes but viewed it as less valuable than the type owned by
Verizon and AT&T and counted only a portion of Clearwire's
entire spectrum ownership toward the screen.
Because the FCC is reviewing its approach to calculating
spectrum and using the spectrum screen in a separate proceeding,
Pai's office took time to negotiate a careful way to word their
response to related concerns, according to the source.
Before the FCC's review and approval were public, AT&T shot
back, decrying the agency not making adjustment to the spectrum
"This refusal to acknowledge and account for all available
BRS/EBS spectrum is neither rational nor defensible," Joan
Marsh, AT&T's vice president of federal regulatory affairs,
wrote in a blog emailed to reporters on Wednesday.
THE ERGEN HURDLE
Both deals involving Sprint for weeks faced an aggressive
bidding war launched in April by Dish Network Corp's
billionaire maverick founder Charlie Ergen, who bid both for
Sprint against SoftBank and for Clearwire against Sprint.
Several minority Clearwire shareholders had launched a
boisterous campaign seeking a higher bid from Sprint and siding
with the satellite TV service provider.
Crest Financial, a large minority shareholder of Clearwire,
which had pushed against Sprint and thrown wrenches into the
FCC's review of the SoftBank deal, dropped its opposition on
Dish bowed out of the bidding for Clearwire last month after
Sprint increased its offer to $5 a share, up from $2.97. Dish
also dropped its battle to buy Sprint after SoftBank sweetened