Dish Network Corp. abandoned its effort to acquire Sprint Nextel Corp., making way for Japanese rival SoftBank Corp. to acquire the third-biggest U.S wireless carrier.
Dish, in a regulatory statement, didn’t specify why it was pulling out of the bidding. The Englewood, Colorado-based company said it would redeem $2.6 billion of bonds that it had issued in May in connection with its bid.
Sprint rejected Dish’s offer earlier this month in favor of a sweetened SoftBank bid, worth $21.6 billion. Dish let a June 18 deadline expire to make a new proposal for Sprint, saying it would focus on a separate offer for Clearwire Corp. Both SoftBank Chief Executive Officer Masayoshi Son and Dish Chairman Charlie Ergen were seeking to enter the U.S. mobile-phone market.
“We’ve been waiting so long to see how this would play out,” said Amy Yong, an analyst at Macquarie Group Ltd. in New York. “I think the market would view it positively if any of those deals happened.”
Dish said its subsidiary Dish DBS Corp. plans to redeem all of its outstanding 5 percent senior notes due in 2017 and all of its outstanding 6.25 percent senior notes due in 2023.
Doug Duvall, a spokesman for Overland Park, Kansas-based Sprint, declined to comment. Sprint raised its offer for Clearwire to $5 a share, 14 percent more than the latest price offered by Dish.
Mitsuhiro Kurano, a Tokyo-based spokesman for SoftBank Corp., declined to comment. Bob Toevs, a spokesman for Dish, said he didn’t have any comment beyond the company’s statement in the filing.
Ergen this year informally approached Deutsche Telekom AG about a possible merger with the German company’s T-Mobile US unit, the number four U.S. carrier, people familiar with the talks said in April.
Sprint shareholders are scheduled to vote June 25 on SoftBank’s offer. Sprint has 55.2 million subscribers after losing 415,000 in the first quarter.
SoftBank has gained three of the four regulatory approvals needed do the Sprint deal, and the U.S. Federal Communications Commission’s review is going well, Son said at the company’s annual shareholder meeting.
Son said that he will serve as chairman of Sprint, with SoftBank Holdings Inc. President Ron Fisher as vice chairman, after the deal closes in early July.
Sprint, which owns slightly more than half of Clearwire, has been attempting to buy the remaining stake since December, prodded by SoftBank. Clearwire shareholders are scheduled to vote July 8 on Sprint’s latest bid, which gained the support of a group of investors that had previously opposed Sprint’s proposals.
To gain the new bid from Sprint, Clearwire’s board also agreed to a $115 million breakup fee if the transaction isn’t completed, further hindering Dish’s chances to make a better offer. Dish hasn’t said whether it will make a new counteroffer for Clearwire.
Sprint fell 1.4 percent to $6.97 at 9:34 a.m. in New York, indicating investors see less likelihood of a new bid. Clearwire rose less than 1 percent to $5.06. SoftBank climbed 1.8 percent to 5,560 yen in Tokyo.
© Copyright 2022 Bloomberg News. All rights reserved.