The combination of investors who want more money and a jilted Charlie Ergen could result in Sprint paying more than they wanted for Clearwire. Dish recently proposed a counter offer to acquire Clearwire at $3.30 a share, which topped Sprint's offer of $2.90 a share. While a Dish acquisition is unlikely due to the penalties written into Sprint's deal with Clearwire, Bloomberg notes the combination of the Dish bid, Clearwire's raising stock price and some investor angst will likely result in Sprint having to raise their offer:
quote:While a Dish deal is a long shot because it’s subject to conditions that may require Sprint’s approval, it’s enough to embolden Clearwire’s minority investors to push Sprint to at least match the bid. With the stock already at that level, traders are betting Sprint will increase its bid by 11 percent, more than any other similar-sized deal pending in North America, according to data compiled by Bloomberg.
However Clear doesn't really have any leverage. Not sure why Sprint 'has to' offer more. Dish offer isn't enough to offset the penalty to break the Sprint deal. Clear can reject it or accept it. Sprint only needs to make a move if another carrier offers more.
I agree. If Sprint has the ability to kill any offer from Dish then there is no need to raise their offer. In fact if they are willing to wait they might be better off by letting Dish move forward and then kill the deal. That will likely lower the value of Clearwire and enable Sprint to come back and make a new offer for the business at a lower price. It's hard ball and it will likely make it take a few years to close the deal but it's an option if Sprint is willing to wait. (Think of what happened to Yahoo's value when they spurned Microsoft's offer.)
sure look at the market sector. You mean the same sector that is acting like a gossip column where if those nice stock sellers hear the customers are about to dump say tech and then alert their stock holders about the incoming storm and people sell like manics and say tech company is out of business. yup you are right customers don't dictate the stock market...right!!!!
That occurred because of management's continued failure to have vision and/or effectively execute on it. Failing to compete in a competitive market and losing customers is not the same as raising rates for customers in a relatively non-competitive environment. I'll grant you that if you can corral a meaningful number of consumers and convince them all to cancel service, the collective can affect the bottom line, but you as an individual consumer will not even be a blip on the company's screen.
combination of the Dish bid, Clearwire's raising stock price and some investor angst will likely result in Sprint having to raise their offer
Duh, this is a given. If there's a better offer on the table, investors will want the money. Nothing surprising there. And Sprint shareholders are likely conflicted since it would mean more money in their pockets while avoiding an outlay of cash for Clearwire. Add in a delay for the Softbank acquisition and I imagine you will have vocal minority of shareholders filing lawsuits if Dish's offer isn't seriously considered.