Dish to stand by for now on Sprint, Clearwire merger: source
Dish Network Corp has no immediate plans to disrupt Sprint Nextel Corp's deal to buy the shares of Clearwire Corp it does not already own, despite Dish's unsolicited offer for Sprint, a source close to the matter said on Monday.
On Monday Dish, the No. 2 U.S. satellite television provider, offered to buy Sprint for $25.5 billion in cash and stock, a move that could thwart the proposed acquisition of Sprint by Japan's SoftBank Corp.
Sprint already owns nearly 51 percent of Clearwire. Under those companies' pending merger agreement, Sprint will pay $2.97 per share to buy the rest of Clearwire.
In January, Dish trumped Sprint's offer for Clearwire, bidding $3.30 per share. That provided ammunition to investors such as Crest Financial Ltd, which argue that Sprint's offer undervalues the company.
Dish Chief Executive Charlie Ergen told Reuters in an interview on Monday that his company has not formally withdrawn its offer for Clearwire but that it will honor the Sprint and Clearwire merger agreement.
"Our deal with Sprint is not contingent on closing the Clearwire deal," Ergen said. "Sprint would still have control of Clearwire and we feel very comfortable based on our past relationship with Clearwire that we can work with Clearwire as a separate company."
But a deal of some kind could still be on the cards down the road. Dish finds Clearwire spectrum attractive, the source said, and has taken into account the additional capital needed to buy Clearwire as well as its $4.5 billion debt load.
"No final decision has been made that Dish has to change anything before the vote between Sprint and Clearwire," the source said. "If it is $3.30, it is not going to break the bank."
Clearwire shares were down 1.8 percent at $3.20 in afternoon trading Monday. The company was not immediately available to comment.
(Reporting By Nadia Damouni and Liana Baker; Editing by Steve Orlofsky)