Report: Sprint Deal Unlikely to Get Past Clearwire Shareholders

[Fraydog]

Sprint should just pay Bancroft $4.40 directly and this debacle is all done with. When the Bancrofts aka Crest cash out, this is all over. They just delusionally think Clear has value on its own when it should be perfectly clear that Clear has failed as a standalone business.

 

That said, if SoftBank would buy Dish and that would be the end of Charlie being involved with Dish, that would be two potentially disruptive businesses Son would own. If that's a possible route, he should explore that.

[Paynefanbro]

$4.40! Dish is pulling more money out of the air! Something is going on with these people.

[Fraydog]

$4.40! Dish is pulling more money out of the air! Something is going on with these people.

 

Dish is just way too desperate to be in debt up to their eyeballs. This doesn't make any sense. If I were advising Charlie I'd tell him to drop it. Maybe Dish and DT could talk turkey. That would still be a large amount of debt even for TMUS. Dish would at least put some upgrades in for rural broadband and they would have the 700 MHz TD-LTE blocks they could use to extend coverage in rural areas.

 

If Charlie were sane that would be the best plan IMO.

[S4GRU]

I would say the odds of the Clearwire deal passing shareholders tomorrow is next to nil. In fact, there's a good chance that Clearwire will delay the vote again and say they need to evaluate the DISH offer.

 

I was reading the synopsis from Guggenheim Securities this morning, and thought this was an interesting take as a possibility:

 

Next steps and implications for our stocks. The Clearwire vote tomorrow now looks likely to fail, as we do not believe it makes sense for Softbank to allow Sprint to further raise its Clearwire offer. Rather, we think Softbank should let the Clearwire vote fail, then subsequently bid for Clearwire itself. This could effectively shift the bidding war away from Sprint and over to Clearwire, an idea we first suggested in our April 29th downgrade of Sprint. If this happens, the price of Clearwire's shares could escalate further, while Sprint's share price may not get bid significantly higher than current levels. We continue to believe DISH is unlikely to ultimately prevail in its bid for Sprint, though we think DISH could end up with some of Clearwire's spectrum. In that case, DISH may enter into a network-hosting deal with Sprint to build out that spectrum, or seek a deal with another wireless carrier – most likely T-Mobile US (TMUS, BUY, $20.98).

Robert via Nexus 7 using Tapatalk 4 Beta

 

[ChadBroChillz]

Looks like Robert can now add the ability to foresee the future to his resume. 

 

Reuters is reporting that Clearwire has postponed the deal.  The article also claims that Dish would still need Sprint approval. 

 

http://www.reuters.com/article/2013/05/30/us-clearwire-dish-sprint-idUSBRE94T0G420130530

[JeffDTD]

Im starting to think that this whole mess could have been minimized if sprint would have simply postponed their initial bid for clear until right before Ergen's offer came to a vote. Had Ergen expected all along that he would get Clear, I do not believe he would have made an offer for sprint. This would have also made the timeframe for him to get a sprint bid together less plausible. Many of us reacted to sprints initial bid for clear as "wrong timing" and in hindsight, very very true. Robert was , if I recall, also very much of that opinion!

 

Sent from my Note II. Its so big.

 

[Rawvega]

This situation rapidly transforming from an inconvenience into a debacle. While money is extremely important, there's another commodity at stake here which is time and, unlike money, that generally can't be made back. These incessant delays will eventually start costing dearly.

[ChadBroChillz]

Im starting to think that this whole mess could have been minimized if sprint would have simply postponed their initial bid for clear until right before Ergen's offer came to a vote. Had Ergen expected all along that he would get Clear, I do not believe he would have made an offer for sprint. This would have also made the timeframe for him to get a sprint bid together less plausible. Many of us reacted to sprints initial bid for clear as "wrong timing" and in hindsight, very very true. Robert was , if I recall, also very much of that opinion!

 

Sent from my Note II. Its so big.

 

I still think Sprint has the upper hand because they got their deal done first. If the FCC approves Sprint-Clearwire, then Sprint has a strong argument even at a lower price. They could close any potential deal within weeks of the vote, while Dish would need regulatory approval. 

[S4GRU]

Sprint just needs to ride out until the end of November, voting down every Dish deal until then and keep Clearwire solvent with cash.  Clearwire will still deploy its TD-LTE during this time providing some benefit for new tri-band devices coming in the Fall.

 

After November 30th, Sprint gobbles up the rest of Clearwire matching any deal Dish made in the interim.  Sprint already owns 54% of Clearwire.  It will only be paying for the rest.  Even if they have to over pay by $1 to $2 per share, it will be worth it in the long run.  

 

Between now and then, If Charlie can agree to a reasonable offer for just the EBS spectrum, Sprint should agree to sell that.  Also, a network hosting deal for Dish if reasonable terms can be reached.  However, I believe that no reasonable offer will be accepted by Dish.  He wants to own it, for two reasons.  One, so he will have long term security and not be beholden to have to renegotiate in the future when a deal expires.  And two, so he can have it for no cost.  He cannot stand that someone would make a profit off him.

 

I believe Sprint/SoftBank could work out a deal with anyone to resolve this.  Except for possibly Charlie.  The only way Charlie will agree to a deal is if everyone else loses.  If everyone else doesn't lose, then he sees he left money on the table.  Yet, he is willing to overpay for Clearwire.  He's shrewd, but he's a dumbass.

 

Robert

[tommym65]

We (and the analysts) need to keep in mind that Sprint and Softbank are managed by intelligent people who are capable of formulating intelligent strategies.  Obviously, they are not sharing those strategies with the outside world.

 

It is unlikely that they are holed up in their separate rooms (as they are required to be by the SEC -- wink,wink) just ranting and throwing new chips on the table every time Dish does something yet more bizarre.

 

It is highly likely that all along they have had a Plan A, Plan B, Plan C, etc.  It brings to mind the old story about the general who was awakened in the middle of the night with a frantic call from one of his subordinates that the enemy was attacking on an unexpected front. "Open the middle drawer and take out Plan D", he said, and went back to sleep.

 

We also need to keep in mind that time is on Sprint's side: NV Phase 1 (what is happening now) does not depend on Clearwire's spectrum or infrastructure. Subsequent phases may need 2500 Mhz, but those phases are in the future.  Waiting for the Standstill Agreement to expire might cause some delays for Sprint, but likely would not be catastrophic.  It likely would be catastrophic for Dish, which faces more severe financial challenges.

 

So, without knowledge of Son's and Hesse's strategic plans, much of our speculation may be entertaining, but really doesn't accomplish anything.

 

Just my $.02

[Moropo]

Robert,

 

What happens in November that you say Sprint should ride it out till November?

 

Thanks.

[S4GRU]

Robert,

 

What happens in November that you say Sprint should ride it out till November?

 

Thanks.

 

After November 30th, the requirement of 50% of Clearwire minority shareholders to approve the deal can be changed.  The 5 years expires November 30, 2013.  I beleive come December 1st, then it could be modified by a majority of shareholders to just require a simple majority (which Sprint already has).

 

Robert

[WiWavelength]

Robert,

 

What happens in November that you say Sprint should ride it out till November?

 

In November, Robert smokes turkeys.  And Ergen is a turkey.  Watch out, Charlie.

 

AJ

[S4GRU]

In November, Robert smokes turkeys.  And Ergen is a turkey.  Watch out, Charlie.

 

AJ

 

Emmm...smoked turkey.  *drool*

 

Robert

[ericdabbs]

Emmm...smoked turkey.  *drool*

 

Robert

 

You sound like Homer Simpson!!

[ericdabbs]

Sprint just needs to ride out until the end of November, voting down every Dish deal until then and keep Clearwire solvent with cash.  Clearwire will still deploy its TD-LTE during this time providing some benefit for new tri-band devices coming in the Fall.

 

After November 30th, Sprint gobbles up the rest of Clearwire matching any deal Dish made in the interim.  Sprint already owns 54% of Clearwire.  It will only be paying for the rest.  Even if they have to over pay by $1 to $2 per share, it will be worth it in the long run.  

 

Between now and then, If Charlie can agree to a reasonable offer for just the EBS spectrum, Sprint should agree to sell that.  Also, a network hosting deal for Dish if reasonable terms can be reached.  However, I believe that no reasonable offer will be accepted by Dish.  He wants to own it, for two reasons.  One, so he will have long term security and not be beholden to have to renegotiate in the future when a deal expires.  And two, so he can have it for no cost.  He cannot stand that someone would make a profit off him.

 

I believe Sprint/SoftBank could work out a deal with anyone to resolve this.  Except for possibly Charlie.  The only way Charlie will agree to a deal is if everyone else loses.  If everyone else doesn't lose, then he sees he left money on the table.  Yet, he is willing to overpay for Clearwire.  He's shrewd, but he's a dumbass.

 

Robert

 

 

So how does this affect the Sprint/Softbank/Clearwire merger deal which was suppose to be able to close in July at the earliest.  I guess if Softbank/Sprint plays this Clearwire debacle until end of November then this Sprint/Softbank/Clearwire merger won't be closed until early 2014?

[S4GRU]

So how does this affect the Sprint/Softbank/Clearwire merger deal which was suppose to be able to close in July at the earliest. I guess if Softbank/Sprint plays this Clearwire debacle until end of November then this Sprint/Softbank/Clearwire merger won't be closed until early 2014?

Sprint and SoftBank can close right after FCC approval without Clearwire, if SoftBank wants to do that.

 

Robert via Nexus 7 using Tapatalk 4 Beta

 

[ericdabbs]

Sprint and SoftBank can close right after FCC approval without Clearwire, if SoftBank wants to do that.

 

Robert via Nexus 7 using Tapatalk 4 Beta

 

I am trying to see if there are any cons for closing the Sprint/Softbank deal in July if they can do so.  If there isn't really a con, I don't see why Softbank/Sprint wouldn't do it to seal the deal.  If Softbank made Sprint and Clearwire combo a condition and the merger would not occur without it, then it gives Dish more firepower to continue to just 1 up Softbank every time they propose a new Clearwire offer knowing it will continue to delay the completion of the merger.  If the Softbank/Sprint deal is finalized then Charlie knows he only has Clearwire to hang his hopes on and Sprint can play the waiting game until end of November to seal the deal.

[Mercurial1]

Clear is no longer a condition on the sprint deal

 

 

Sent from my SPH-L900 using Tapatalk 2

 

 

[ChadBroChillz]

Clearwire has not been a condition since the merger was announced, however it is still clearly a big part of their plans. Clearwire's 20Mhz TD-LTE network would allow them to compete with the title of fastest network. While most of us could not care less about fastest network, it would go a long way in changing Sprint's image of being the slow network.  I also believe they want NV 2.0 to include 2.5Ghz out of the gate instead of waiting until Dec, however,  I do not believe Softbank will postpone the closing of their deal just to include Clearwire.

[Mercurial1]

Clearwire has not been a condition since the merger was announced, however it is still clearly a big part of their plans. Clearwire's 20Mhz TD-LTE network would allow them to compete with the title of fastest network. While most of us could not care less about fastest network, it would go a long way in changing Sprint's image of being the slow network. I also believe they want NV 2.0 to include 2.5Ghz out of the gate instead of waiting until Dec, however, I do not believe Softbank will postpone the closing of their deal just to include Clearwire.

 

I understand that. I only posted the slide because there seemed to be some questions on it.

 

Sent from my SPH-L900 using Tapatalk 2

 

 

[ericdabbs]

I understand that. I only posted the slide because there seemed to be some questions on it.

 

Sent from my SPH-L900 using Tapatalk 2

 

Thanks for the image.  I feel better about it now.  In this case, maybe the best route for Sprint to go to acquire Clearwire is to wait it out until November.  I just hope the release of tri-band LTE devices are not delayed because of this Clearwire debacle.  I know Sprint has already sent out a press release talking about tri-band LTE devices later on this year but who knows.

[S4GRU]

Thanks for the image.  I feel better about it now.  In this case, maybe the best route for Sprint to go to acquire Clearwire is to wait it out until November.  I just hope the release of tri-band LTE devices are not delayed because of this Clearwire debacle.  I know Sprint has already sent out a press release talking about tri-band LTE devices later on this year but who knows.

 

Since Clearwire is deploying and will continue to deploy its TD-LTE network, I think that is a non-issue.  It will not become a problem unless Dish gets 100% control of Clearwire.  But even that requires Sprint approval.  And Sprint will not approve unless they have already mitigated the problem.

 

Robert

[bigsnake49]

According to Fierce Wireless:

 

While Dish said its offer is for all Clearwire shareholders including majority owner Sprint, it is willing to buy out only minority shareholders as long as it can acquire at least 25 percent of Clearwire's voting stock. Dish said it wants the right to pick at least three Clearwire board members and more if it acquires more of Clearwire's shares. Dish also wants the right to approve changes to Clearwire's structure as well as transactions Clearwire enters into with other companies, including Sprint, unless such deals are approved by "an independent and disinterested board committee."

Read more: Analysts: SoftBank could 'walk away' from Sprint following Dish's bid for Clearwire - FierceWireless http://www.fiercewireless.com/story/analysts-softbank-could-bail-sprint-following-dishs-bid-clearwire/2013-05-31#ixzz2UtoZ4fz4 
 

I don't know if Dish can get the number of seats it wants or have veto power on the structure.

[Rawvega]

Masa and/or Dan should ask Charlie how it feels to want.

 

The right to approve transactions Clearwire enters into with Sprint...Yeah, that's gonna go over about as well as a turd in a punchbowl. There's no way Sprint would allow that.