Is Dish’s Clearwire Bid a Sign of Concern?

The drama never ends in the Sprint (NYSE:S) acquisition attempts of Clearwire (NASDAQ:CLWR). For everything related to Sprint, Dish Network (NASDAQ:DISH) seems to be a consistent disruptor.

Sprint had made a bid to buy up Clearwire, or to buy up the 50 percent of the company that it didn’t already own, and that offer valued the company at $2.97 per share. However, that bid was blocked by activist investors. As a result, Sprint upped its bid to $3.40 per share one week ago, saying the offer “represents Sprint’s best and final offer.”

After the latest offer from Sprint was announced, Clearwire’s board of directors had a special committee meeting in which they determined that shareholders should vote to accept the offer from Sprint. The group is expected to reconvene Friday, May 31, and could put a vote through at that time.

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Unfortunately for Sprint, Dish didn’t want to leave things alone. While it viewed Sprint’s offer as fair, in the stockholders’ best interest, and the best on the table, that may no longer be the case. Dish has upped the bid for Clearwire, topping Sprint’s big of $3.40 per share with its own bid of $4.40 per share. This is 30 percent higher than Sprint’s bid and values the company at $6.47 billion.

This new bid could present a major problem for Sprint and its “final offer.” A Clearwire spokesperson said the special committee would review the new offer, adding that the committee hadn’t decided whether it should change its recommendation to approve Sprint’s bid.

Dish chairman and co-founder Charlie Ergen said, “The Clearwire spectrum portfolio has always been a key component to implementing our wireless plans of delivering a superior product and service offering to customers.” Aside from Clearwire, Dish has been making attempts to acquire Sprint as well.

In the bid for Sprint, SoftBank was the company leading the charge, but in that case as well, Dish came in and disrupted the bid. Similarly, Dish offered a bid higher than SoftBank’s. However, SoftBank President and Chief Executive Officer Masayoshi Son had said that the company wouldn’t increase its own bid in reaction to Dish’s, going further to suggest that Dish was ill-prepared to run a wireless carrier and would drag Sprint into debt.

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Considering the two angles that Dish is working, it’s possible that Dish is actually concerned about losing the bid for Sprint to SoftBank. If Dish thought it could win the bid for Sprint, then it would seem wise to let Sprint acquire Clearwire, and then Dish could acquire Sprint. But if Dish is concerned about getting Clearwire and thinks it might fail to win the bid for Sprint, then it makes sense that Dish would up the bid as dramatically as it did for Clearwire in hopes that it can at least acquire one of the two companies.

Clearwire’s shares were trading up 20 percent Thursday morning at around $4.20. Sprint’s shares were down about half of a percentage point, while Dish’s shares were up by the same.

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