Son has shown he’s just as formidable a player in the quest to buy Sprint and access Clearwire’s spectrum. His latest move came Monday when he worked out a deal with Sprint that increased his offer to $21.6 billion.
As if offering a bid that was lower than Dish and having it still be accepted by Sprint was not enough, Son seems to want even more. Sprint has discarded Dish’s offer, saying the company’s offer was not actionable. It has given Dish until June 18 to submit its “best and final offer.”
“As a consequence of the lack of progress with DISH and the improved terms from SoftBank, the Special Committee ended its discussions with DISH and will request that DISH destroy all of the Sprint confidential information made available in the course of its diligence.”
Running Out of Time
I can’t understand why Sprint agreed to allow Dish to look at its books in the first place. No matter, Dish quickly followed the announcement of the amended merger agreement with an announcement of its own stating that it “will analyze the revised SoftBank bid as we consider our strategic options.”
Time is of the essence when it comes to the finances of Sprint and Clearwire. Sprint has struggled to catch up with wireless carrier leaders AT&T and Verizon so it desperately needs billions of dollars of cash SoftBank will invest in it. On that same note, Clearwire’s management has said that without some kind of financial help, it could be bankrupt by the end of the year.
Can we vote already
As it does its analyzing, Sprint and Clearwire shareholders are looking for some kind of resolution to all of this. The back and forth has led to several votes being postponed. As it stands now, Clearwire’s shareholders were scheduled to vote on Sprint’s proposal on Thursday. I doubt that will happen with SoftBank’s latest proposal to buy Sprint scheduled for June 25.
Outside of Ergen being out of his league in vying for Sprint and Clearwire, I think the companies’ shareholders would be better off with SoftBank. For Sprint shareholders, SoftBank’s offer amounts to a 52% premium to its original offer. It pledges to deliver an additional $4.5 billion of cash to Sprint stockholders at closing, bringing the total cash consideration available to Sprint stockholders to $16.64 billion.
The article Who’s Your Godfather? Offers For Clearwire Defining Telecom Leaders originally appeared on Fool.com and is written by Tedra DeSue.
Tedra DeSue has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Tedra is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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