About Us  |   Contact Us  |   Register  | Login  |   

Follow HedgeWorld on Twitter HedgeWorld on LinkedIn






HEDGEWORLD NEWS
Search the News
Advanced News Search
HedgeWorld News by Region
United States / Americas
Europe
Asia / Australia
International
HedgeWorld News Sections
Managed Futures & Derivatives
Daily News
Regulatory/Legal
Strategies/Analysis
Technology
Opinion
People
Indexes
Other News Features
Most Popular
LexisNexis Headlines
Reuters Headlines
The HedgeWorld Blog
Alternative Advantage Daily Newsletter
RSS Service
Sign Up For Email News Alerts
Reprints



UPDATE 2-Sprint sues Dish, Clearwire as key deadline looms
06/18/2013 Email this story  |  Printable Version

* SoftBank, Dish seek to buy Sprint

* Sprint, Dish seek control of Clearwire

* Lawsuit filed in Delaware Chancery Court

By Jonathan Stempel and Sruthi Ramakrishnan

June 17 (Reuters) - Sprint Nextel Corp on Monday said it has sued Dish Network Corp to block its tender offer for Clearwire Corp, on the eve of a key deadline in a takeover battle that also includes Japanese mobile carrier SoftBank Corp.

The lawsuit filed on Monday in Delaware Chancery Court accuses Dish of trying to "fool" and "coerce" Clearwire shareholders into tendering their shares, and rejecting Sprint's competing effort to buy the 49.8 percent it did not already own of the wireless broadband provider.

It came one day before a deadline for Dish to sweeten its earlier $25.5 billion bid to buy Sprint, which has endorsed a competing bid by SoftBank.

Sprint said Dish's offer would leave non-tendering shareholders owning stock in a company "handicapped by unlawful corporate governance restrictions, onerous debt provisions, and potentially ... subject to massive money damages claims payable to Dish - an entity which has everything to gain from a failure of Clearwire."

The lawsuit also names Clearwire as a defendant.

Last week, Clearwire's board urged shareholders to accept the Dish tender offer, which values Clearwire at $4.40 per share. Sprint has offered $3.40 per share for the Clearwire stock it does not own.

Dish spokesman Bob Toevs said: "We are reviewing the complaint and considering our options."

Clearwire spokeswoman Susan Johnston said that company does not discuss pending litigation.

JUNE 18 DEADLINE

The lawsuit adds a new complexity to a takeover battle in which SoftBank and Dish are bidding for Sprint, while Dish and Sprint are bidding for Clearwire.

Last week, SoftBank raised its offer for Sprint to $21.6 billion from $20.1 billion, which would give it a 78 percent stake in the Overland Park, Kansas-based company.

The new offer includes $16.6 billion of cash, and would be the largest overseas acquisition by a Japanese company.

Sprint then gave Dish, a satellite TV provider controlled by billionaire Charlie Ergen, until June 18 to sweeten the $25.5 billion bid, which it said is not "actionable," and make its best and final offer.

Dish is based in Englewood, Colorado, and Clearwire in Bellevue, Washington.

WIRELESS MOVES

Known for pursuing fierce takeover battles, Ergen is interested in Clearwire to expand into wireless amid a maturing of Dish's traditional pay-TV business.

Sprint, meanwhile, hopes to use Clearwire to help it better compete in mobile communications with larger rivals AT&T Inc and Verizon Wireless .

SoftBank had approved the Sprint bid for Clearwire, but said it would be content even if shareholders rejected that bid because Sprint would still control a majority of the company.

The Japanese company is controlled by billionaire founder Masayoshi Son, who is known as a risk-taker despite his country's normally cautious corporate culture.

Shareholders of Sprint are scheduled to vote on the $21.6 billion SoftBank offer on June 25.

Paulson & Co, the hedge fund firm run by billionaire John Paulson and Sprint's second-largest shareholder, has said it would vote for the SoftBank transaction.

The lawsuit was announced after U.S. markets closed. In Monday trading, Sprint shares closed down 10 cents at $7.22, while Clearwire shares were unchanged at $4.63.

The case is Sprint Nextel Corp et al v. Dish Network Corp et al, Delaware Chancery Court.


Email This Story to a Friend   |   Display Printable Version of This Story

Story Copyright © 1999-2014 Reuters HedgeWorld All rights reserved.

HedgeWorld News is sponsored by:






Lipper    Privacy   User Policy  Legal Disclosure Copyright/DMCA  Site Map    FAQ    Glossary  Thomson Reuters for Hedge Funds
All rights reserved. Users may download and print extracts of content from this website for their own personal and non-commercial use only. Republication or redistribution of HedgeWorld content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. HedgeWorld is a registered trademark of Thomson Reuters.