DISH Network Tops Sprint Bid for Clearwire by $1 per Share

In the ongoing bidding war for Clearwire (UNKNOWN: CLWR.DL  ) , DISH Network (NASDAQ: DISH  ) has sent a letter to the Clearwire board with an offer to purchase the wireless firm for $4.40 a share in cash.

The bid from DISH is a 29% premium over an earlier $3.40-a-share bid for the Clearwire shares it doesn't already own from Sprint (NYSE: S  ) . With a Clearwire shareholders meeting on the Sprint offer set for tomorrow, DISH Network is making the offer public, "in light of the limited time remaining," the company said in its press release. Reuters is reporting that two sources are saying Clearwire is expected to postpone the vote on the Sprint offer.

Clearwire's largest minority shareholder, Crest Financial, has been campaigning against the Sprint bid, arguing the company should hold out for a higher bid, perhaps from another suitor.

In a letter dated Wednesday to John Stanton, the chairman of Clearwire, DISH Network chairman and co-founder Charlie Ergen said, "We have reviewed your recently amended merger agreement with Sprint Nextel Corporation ... and we continue to believe we can provide a meaningfully superior alternative to your stockholders, so we are presenting a transaction valued at $4.40 per share." The letter from DISH Network also notes its board had approved the offer, and it is "not subject to any financing contingency."

DISH Network's letter detailing its latest acquisition offer follows two recent announcement issued by Clearwire, dated May 28 and May 29, in which Clearwire reiterated earlier recommendations to its shareholders to accept Sprint's most recent bid. Sprint has said its offer of $3.40 a share is its "best and final offer." 


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  • Report this Comment On May 30, 2013, at 1:12 PM, nivegulu wrote:

    It's still far from fair value ~$12 pps.

    New Study Says Sprint Bid Vastly Undervalues Clearwire

    Tue Mar 12, 2013 12:32pm EDT

    WASHINGTON, March 12, 2013 /PRNewswire-USNewswire/ -- A new study by former

    FCC commissioner Dr. Harold Furchtgott-Roth and the Analysis Group asserts

    that the price Sprint has offered for Clearwire Corporation significantly

    understates the true value of Clearwire's technology opportunities and wireless

    spectrum holdings. The study supports Crest's contention that the public would

    be best served if Clearwire remained free to offer its spectrum to multiple

    wireless carriers.

    The study was submitted to the Federal Communications Commission today by Crest

    Financial Limited, a major minority shareholder in Clearwire, in connection with

    the FCC's review of Sprint's proposed acquisition of Clearwire.

    According to the Furchtgott-Roth Report, Sprint's $2.97 per share offer for

    Clearwire represents a value of just $0.11 per MHz pop for Clearwire's

    spectrum and significantly understates the current value of Clearwire's unique

    spectrum holdings. The Report says that applying reasonable assumptions to the

    multi-customer business plan presented by two firms advising the Clearwire board

    results in a valuation between $9.54 and $15.50 per share. These share price

    values correspond to spectrum prices between $0.31 and $0.50 per MHz pop.

    The Sprint offer also fails to account for Clearwire's unique ability to deploy

    wireless technology that offers far greater future value than the technology

    currently offered by most major U.S. carriers, the study says. In his report,

    Dr. Furchtgott-Roth explains that TDD-LTE technology allows for higher download

    speeds and efficient spectrum utilization. He also notes that "the only band of

    spectrum in the United States that can be developed for TDD-LTE services is

    the 2.5 GHz band largely controlled by Clearwire."

    The Report, which was commissioned by Crest, explains that Sprint's offer

    ignores both the value ascribed to similar spectrum in recent transactions and

    the fact that Clearwire's spectrum holdings, together with its technology

    offerings, are well-suited for use by multiple carriers. "The fragmented

    spectrum holdings of other U.S. carriers create an opportunity for Clearwire to

    offer a valuable wholesale service," the report states. The Report supports

    Crest's argument made in filings with the FCC that Sprint's acquisition of

    Clearwire would harm not only Clearwire shareholders but also the public at


    Furthermore, the Report says that for unexplained reasons Clearwire abandoned

    the lucrative multi-customer strategy in favor of the Sprint acquisition. The

    Report supports Crest's position that the public would be best served if

    Clearwire could offer its spectrum to multiple customers, thereby allowing more

    wireless carriers to pursue new technologies and mount challenges to the

    wireless market's current duopoly.

    Dr. Furchtgott-Roth was an FCC commissioner from 1997 through 2001. Before that,

    he was chief economist for the House Committee on Commerce and a principal staff

    member on the Telecommunications Act of 1996.

    The Furchtgott-Roth study echoes a separate study, also done for Crest, by

    Information Age Economics (IAE), which says that the true value of the wireless

    spectrum owned by Clearwire is two or three times higher than the value

    reflected in the price Sprint has offered to pay to acquire Clearwire.

    The Furchtgott-Roth Report can be found here:

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