Further muddying Clearwire’s future is a report that Verizon Wireless has offered up to $1.5 billion to acquire the rights to some of Clearwire’s 2.5 GHz spectrum licenses.
The Wall Street Journal reported this morning that according to a Clearwire filing late last week, the carrier noted it had received an offer from a “Party J,” which sources told the WSJ was Verizon Wireless. Clearwire currently controls approximately 150 megahertz of spectrum in the 2.5 GHz band across the country, with much of that tied to broadband radio service/educational broadband service licenses that Clearwire is leasing from those license owners.
Clearwire is currently mulling over a pair of bids, a $2.2 billion offer from Sprint Nextel to acquire the remaining stake in Clearwire it does not currently own, and a rival bid from Dish Networks valued at an 11% premium compared with the Sprint Nextel bid. Clearwire did note in latest filing that it was urging shareholders to vote in favor of the Sprint Nextel offer.
For its part, Clearwire has said it was looking over both offers, though it has twice dipped into funding provided by Sprint Nextel as part of its acquisition attempt. Those moves triggered a pair of offers from Clearwire shareholders offering to provide the carrier funding in order to not further align Clearwire with the Sprint Nextel offer.
Reuters also reported that as part of its filing, Clearwire also noted that it was looking at skipping an interest payment on about $4.5 billion in debt.
This financial mess was further dirtied today as Dish Networks put in an unsolicited $25.5 billion offer to acquire 68% Sprint Nextel, which is in the process of having 70% of its equity acquired by Japan’s Softbank for $20.1 billion. Dish’s offer includes $17.3 billion in cash and $8.2 billion in stock of the new combined operations, representing what Dish said is an 18% premium per share over Softbank’s offer and greater control over the new operations.
Analysts noted that Dish’s move on Sprint Nextel does not have a direct tie to its offer for Clearwire, though Dish’s management talked extensively about the combined spectrum holdings of Sprint Nextel and Clearwire in justifying the Sprint Nextel offer.
“Clearwire is not a requirement for the Dish/Sprint transaction but it appears to be part of Dish’s long-term vision,” wrote Jennifer Fritzsche, senior analyst at Wells Fargo Securities, in a research note. “[Dish Chairman Charlie] Ergen stated in regard to the Clearwire transaction that he believes in fair value and that Dish is on record as to what it thinks the fair value of Clearwire is.”
Macquarie Equities Research noted that it expected Softbank to eventually prevail in its acquisition attempt of Sprint Nextel, though at a possibly increased price, which could leave Dish making an attempt at acquiring T-Mobile USA from parent company Deutsche Telekom. Reports surfaced over the weekend that Dish had approached DT about buying out its stake in T-Mobile USA, which is in the process of attempting to acquire MetroPCS. However, a final vote on that deal by MetroPCS shareholders was called off at the last second on Friday. That move followed calls from investor services for MetroPCS shareholders to not approve the deal in its original terms, with DT putting in a last minute alteration to those terms to lessen the debt burden of the new operations.
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