Sprint Boosts Takeover Bid for Clearwire

on Jun 21, 2013

Sprint Nextel Corp. (NYSE:S), the third-largest mobile operator in the US, raised its takeover offer for Clearwire Corp (NASDAQ:CLWR) to $5 per share on Thursday, June 20, striking a decisive blow against bidding rival Dish Network Corp (NASDAQ:DISH).

Sprint owns 51 percent of the Clearwire stock and is seeking to take full control of the US-based provider of mobile broadband communications services.
The Clearwire share price jumped seven percent on the Nasdaq Thursday, closing at $5.04. The Sprint share price gained one percent to $7.07 at the close on the New York Stock Exchange, but was down 1.7 percent at $6.95 in pre-market trading on Friday.

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**Final blow**
Sprint’s latest offer signals a possible end to the bidding battle, which started in January, when Dish made an offer of $3.30 for the Clearwire shares not owned by the mobile carrier. That topped Sprint’s initial offer of $2.97 per share, making the company to improve its offer to $3.40 per share. Dish, controlled by billionaire Charlie Ergen, was believed to have struck the final blow in the battle last week, when the Clearwire board endorsed its counter offer of $4.40, but the latest response by Sprint has put puts the mobile operator in the pole position once again.

Cleawire has put its support behind the latest offer and several analysts believe that the US mobile carrier will finally prevail.
“We believe Clearwire shareholders will approve the $5 offer from Sprint regardless of any new overtures from Dish,” said BTIG analyst Walter Piecyk, as quoted by Reuters.
Sprint said that it had support from shareholders holding 45 percent of Clearwire’s minority shares, just shy of the more than 50 percent it needs to take over the company. Sprint also had Clearwire change its governance rules to include a break-up fee of $115 million that Clearwire would have to pay if the latest deal fails.

Erik Prusch, Chief Executive Officer of Clearwire expressed confidence that the deal could get enough support from shareholders.
!m[Sprint Boosts Takeover Bid for Clearwire ](/uploads/story/3302/thumbs/pic_1_inline.jpg)
“That’s completely different to where we were a short time ago,” said Prusch, as quoted by Reuters.
The battle between Sprint and Dish highlights the value of Clearwire’s airwave telecommunication assets considered crucial for Sprint’s plans for a 4G network. Dish, on the other hand, has hoped to build a large enough stake in Clearwire to use it as a wild card in its bidding war with Japan’s SoftBank Corp for the acquisition of Sprint.

Dish said in a regulatory statement on Friday that it was pulling out of the bidding for Sprint without giving reasons for that move.
**The Clearwire share price was $5.07 as of 14.32 GMT, 21.06.2013**
**The Sprint share price was $6.98 as of 14.32 GMT, 21.06.2013**
**The Dish share price was $39.72 as of 14.32 GMT, 21.06.2013**
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