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Clearwire board to shareholders: Go on, grab that Dish cash

Sprint looks on in dismay

Internet Security Threat Report 2014

The board of Clearwire has unanimously recommended that shareholders take the Dish cash, despite the fact that the broadband wireless firm's biggest shareholder is dead set against the deal.

That shareholder is Sprint, which already owns the majority of Clearwire and has offered $3.40 per share for the rest. But, just days before the vote, Dish trumped that with $4.40 a share, a deal the Clearwire board is now recommending to shareholders.

Sprint and Dish are currently tussling over Clearwire because of its portfolio of prized wireless spectrum, which will ultimately be of great value to whoever acquires it.

Sprint can't just push though its offer, despite the majority holding, so a Special Committee "consisting of independent, non-Sprint-affiliated directors" looked at the deals and unsurprisingly agreed that an additional dollar per share was in the interest of all present.

Dish Network is offering more money, but it comes with strings attached and Sprint had hoped to gain complete ownership of Clearwire while Sprint itself being bought by Softbank.

Tokyo-based Softbank raised its offer for Sprint earlier this week, after its original offer (of $6.30 a share, around $20bn) was topped by Dish, which wants to absorb both Clearwire and Sprint to create a viable competitor to AT&T and Verizon in the US mobile space.

Dish was offering $7 a share for Sprint, putting the price somewhere around $25bn of which it has raised almost ten. The rest would be debt, and the deal would have to jump through various regulatory hoops too while Softbank has already completed that stage.

Softbank's new offer hits $7.48 a share. Not only that, but Softbank has convinced Sprint to require alternative bids to be fully financed and, The New York Times tells us, enact a shareholders' rights plan which would prevent Dish from making an offer direct to shareholders.

All of which looks a bit grim for Dish Network and its rambunctious chairman Charlie Ergen.

Softbank has said it doesn't mind if Dish gets a share of Clearwire; once it owns Sprint it will have a controlling interest anyway, but without that control, and without Sprint's infrastructure, it's hard to see how Dish Network can get into the mobile industry at all.

The Clearwire vote has now been pushed to 24 June, while the Softbank/Sprint deal won't wrap up until 1 July, so there's still plenty of time for everything to change, again. ®

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