In an unexpected turn on June 12th, Clearwire declined the rival bid from existing majority owner Sprint Nextel and instead selected the rival Charlie Ergen bid via his Dish Network pay-TV operation.
Late on June 12th in a regulatory filing Clearwire urged its stockholders to accept the Dish bid which is worth $4.40 a share, and well ahead of Sprint’s $3.40. Clearwire stated that advising any other action would risk landing it in legal actions if it were seen to be breaching its fiduciary duty in recommending the best price for shareholders.
Both Sprint and Dish Network were, in essence, bidding for Clearwire’s large portfolio of wireless spectrum. Dish Network has made no secret of its wish to morph its pay-TV operation from DTH to terrestrial customers. Sprint remains a 51 per cent owner of Clearwire.
Sprint, in a statement, said it was evaluating Clearwire’s comment and would “review any corresponding filings before determining its next steps.” It said it intends to enforce its governance rights as Clearwire’s majority shareholder. It previously said its $3.40 per share bid was final.
Which does not mean that the battle is over. Dish Network has extended until July 2nd for Clearwire shareholders to accept its bid, and of course, Sprint could come in with an improved offer.