DISH Network Corp (NASDAQ:DISH) dropped out of the bidding to buy mobile phone carrier Sprint Nextel Corporation (NYSE:S), paving the way for Sprint Nextel Corporation (NYSE:S)’s acquisition by SoftBank Corp (PINK:SFTBF) (TYO:9984).
The Douglas Country-based satellite TV company, DISH Network Corp (NASDAQ:DISH), didn’t submit a new offer for Sprint Nextel Corporation (NYSE:S) by the Tuesday deadline. Late Tuesday, the satellite TV company said it was “impracticable” to meet the deadline.
SoftBank’s $25.5 Billion Offer
Last week, SoftBank Corp (PINK:SFTBF) (TYO:9984) agreed to enhance its offer for Sprint Nextel Corporation (NYSE:S) by 7.5 percent to $21.6 billion to counter DISH Network Corp (NASDAQ:DISH)’s unsolicited proposal of $25.5 billion.
According to the revised offer, Japan’s SoftBank Corp (PINK:SFTBF) (TYO:9984) will pay $16.6 billion to Sprint Nextel Corporation (NYSE:S)’s shareholders and infuse $5 billion of new capital for a 78 percent stake. The revised deal would facilitate shareholders get more money while Sprint Nextel Corporation (NYSE:S) gets less cash.
The revised deal with Sprint Nextel Corporation (NYSE:S) offered DISH Network Corp (NASDAQ:DISH) a June 18 deadline to submitting a best and final offer.
Sprint Nextel Corporation (NYSE:S)’s board of directors earlier unanimously approved the Tokyo-based mobile phone carrier’s improved offer. The third-largest U.S. wireless carrier indicated that DISH Network Corp (NASDAQ:DISH)’s proposal is not actionable and not reasonably likely to a superior offer.
The Tokyo-based mobile-phone carrier’s sweetened offer also got support from hedge fund Paulson & Co, the second largest Sprint Nextel Corporation (NYSE:S) shareholder.
DISH Network To Focus On Clearwire
DISH Network Corp (NASDAQ:DISH), however, indicated it continues to see strategic value in a merger with Sprint Nextel Corporation (NYSE:S).
DISH Network Corp (NASDAQ:DISH) said it would now focus, instead, on its bid for the wireless carrier Clearwire Corporation (NASDAQ:CLWR). DISH Network Corp (NASDAQ:DISH) has offered $4.40 per share to acquire Clearwire, which is 29 percent higher than the sweetened bid provided by Sprint Nextel Corporation (NYSE:S).
Earlier,DISH Network Corp (NASDAQ:DISH) got a boost when Clearwire Corporation (NASDAQ:CLWR)’s board has announced that it is backing DISH Network Corp (NASDAQ:DISH)’s bid over Sprint Nextel Corporation (NYSE:S)’s offer.
The satellite operator could still submit a new bid for Sprint Nextel Corporation (NYSE:S), but under the terms of the revised deal with SoftBank Corp (PINK:SFTBF) (TYO:9984), Sprint Nextel Corporation (NYSE:S) can no longer terminate SoftBank Corp (PINK:SFTBF) (TYO:9984)’s offer. SoftBank Corp (PINK:SFTBF) (TYO:9984) could go directly to shareholders and request a vote.
