Paul Otellini is favoring Softbank Corp (OTCMKTS:SFTBF) (TYO:9984) over DISH Network Corp (NASDAQ:DISH) for the takeover of Sprint Nextel Corporation (NYSE:S) according to Reuters. The CEO of Intel Corporation (NASDAQ:INTC) has written a letter to Federal Communications Commission (FCC) Chairman Julius Genachowski in which he said that he is backing SoftBank, which is a wireless carrier based in Japan.
There have been talks held between Sprint Nextel Corporation (NYSE:S) and Softbank Corp (OTCMKTS:SFTBF) (TYO:9984) since last October over the $20 billion offer. The deal was almost finalized but to everyone’s surprise Dish offered $25.5 billion to acquire Sprint. The deal will be concluded by July if Sprint accepts the offer of SoftBank.
Otellini in his letter to FCC wrote that the idea of SoftBank building the third largest US wireless network was very enticing, and the intensity of competition should increase in the wireless carrier competition.
“We need this competition in the wireless space as the ATT/Verizon model is not giving that to consumers at this time,” Otellini said.
There was no further word from Otellini as to why he favors SoftBank over DISH Network Corp (NASDAQ:DISH). According to a spokesperson of Intel Corporation (NASDAQ:INTC), SoftBank is a business partner of Intel and thus Otellini’s favor is natural. He further said that, after the deal, SoftBank would emerge as the third competitor in the market, and the ultimate benefit will be for the consumers. He went on to say that SoftBank is largely seen as a market disruptor, which will also be beneficial.
Dish, on the other hand, has also sent a letter to FCC, earlier, and has asked to put down the review of SoftBank’s takeover bid of Sprint. The firm said that this acquisition will not be in the interest of the US national security.
Sprint stated on Monday that Softbank Corp (OTCMKTS:SFTBF) (TYO:9984) has cancelled some terms of the agreement to allow Sprint to derive more information from Dish. The tentative special meeting for shareholders to vote on the proposed deal with Softbank will held on June 12.
Softbank Corp (OTCMKTS:SFTBF) (TYO:9984) made the point that though it has given some waiver to Sprint Nextel Corporation (NYSE:S), it does not allow disclosing private information or negotiating with Dish.
DISH Network Corp (NASDAQ:DISH) reported that Sprint Nextel Corporation (NYSE:S) had sent it a request to deliver more information about the bid and along with a non-disclosure agreement to ensure that the information will be kept confidential and not be exchanged. Dish cleared that some information was provided to Sprint on receiving the request from a Sprint Special committee.
The chairman of DISH Network Corp (NASDAQ:DISH) reflected a sense of confidence when he said that his company is confident that the Sprint Board will realize that their offer is better than SoftBank.