Dish Raises Offer For Clearwire To Top Sprint Bid

By Mani
Updated on

Dish Network Corp (NASDAQ:DISH) has enhanced its bid for mobile-broadband operator Clearwire Corporation (NASDAQ:CLWR) to $4.40 per share, topping its rival Sprint Nextel Corporation (NYSE:S) bid by nearly 30 percent.

Dish Raises Offer For Clearwire To Top Sprint Bid

Dish Network Corp Letter To Clearwire

Dish Network Corp (NASDAQ:DISH) indicated in its Wednesday letter to Clearwire Corporation (NASDAQ:CLWR) Chairman John Stanton that Dish board had approved the revised offer.

The mobile-broadband operator Clearwire Corporation (NASDAQ:CLWR) is scheduled to hold a special shareholder meeting on Friday to consider the Sprint Nextel Corporation (NYSE:S) offer.

Last week, the number three operator in the U.S. Sprint Nextel (NYSE: S), upped the takeover ante in the wake of a competing bid by Dish Network Corp (NASDAQ:DISH). Sprint Nextel Corporation (NYSE:S) enhanced its offer price from $2.97 per share to $3.40, which is 10 percent higher than the earlier unsolicited offer of $3.30 per share made by Dish. Sprint Nextel Corporation (NYSE:S) CEO indicated last week that its revised offer was his company’s ‘best and final’ offer.

Last week’s offer from Sprint represented a 14 percent increase over its earlier bid announced in December. However yesterday’s revised offer from Dish Network Corp (NASDAQ:DISH) values Clearwire Corporation (NASDAQ:CLWR) at $6.47 billion, according to outstanding share position as of May 29.

In a subsequent statement released last week, Clearwire indicated that its Special Committee feels the revised offer from Sprint is the most favorable potential transaction to the company’s unaffiliated stockholders, besides being in the best interest of its unaffiliated shareholders.

However yesterday, Clearwire Corporation (NASDAQ:CLWR) issued a statement expressing its Special Committee would review the revised offer from Dish Network Corp (NASDAQ:DISH) to ascertain the best course of action for the company and its stockholders.

During December, Clearwire’s board of directors agreed to Sprint’s (NYSE: S) offer, but some minority shareholders in Clearwire Corporation (NASDAQ:CLWR) considered the deal would undervalue the company and threatened to reject the deal.

Citing paucity of time as the reason, Dish (NASDAQ: DISH) said it made its letter to Clearwire Corporation (NASDAQ:CLWR) public. The satellite TV provider expressed its intention to commence a tender offer for the outstanding Clearwire shares before Friday’s meeting. Dish Network Corp (NASDAQ:DISH)’s revised offer is for all shareholders, but it’s also open to buy out only minority stockholders till it can acquire at least 25 percent voting stock of Clearwire Corporation (NASDAQ:CLWR).

The number three operator in the U.S., Sprint  intends to use Clearwire’s spectrum to enhance its new LTE network.

However, recently the satellite TV provider Dish won approval from the Federal Communication Commission to build its own LTE network. Dish Network Corp (NASDAQ:DISH) however, has a target to complete 40 percent of its LTE network within the next four years, and 70 percent in seven years.

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