Satellite TV company Dish Network has given up its fight to acquire Sprint in the face of tough competition from Japan’s SoftBank, reports Dow Jones Newswires.
Dish (Meridian, CO, USA) is said to have made clear its intention not to continue pursuing a takeover of Sprint in a recent securities filing.
The news comes after the company last week said it would not be able to improve its offer by a Sprint-imposed deadline of June 18.
“While Dish continues to see strategic value in a merger with Sprint, the decisions made by Sprint [Overland Park, KS, USA] to prematurely terminate our due diligence process and accept extreme deals protections in its revised agreement with SoftBank [Tokyo, Japan], among other things, have made it impracticable for Dish to submit a revised offer by the June 18 deadline imposed by Sprint,” said Dish in last week’s statement.
“We will consider our options with respect to Sprint, and focus our efforts and resources on completing the Clearwire [Bellevue, WA, USA] tender offer,” said the company, indicating that at the time it had not made a final decision on how to proceed.
The news removes a major obstacle to SoftBank’s $21.6 billion offer for 78% of Sprint, on which Sprint’s shareholders are set to vote this week.
Many analysts believe the involvement of SoftBank, Japan’s third-biggest mobile operator, could help to revitalize Sprint, which has struggled to compete against AT&T (Dallas, TX, USA) and Verizon Wireless (New York City, NY, USA), the two biggest operators in the US market.
Although Dish has said it will focus efforts on a takeover of Clearwire, it has faced competition over that deal from none other than Sprint.
Indeed, on June 20, Sprint appeared to have dealt another blow to Dish Network with an improved offer for Clearwire that valued the mobile broadband operator at $5 a share.
Sprint had previously offered just $3.40 a share for the 50% of Clearwire it does not own, prompting Clearwire’s board to back a subsequent Dish offer worth $4.40 a share.
But Clearwire’s board has now swung firmly behind Sprint’s revised bid.
Dish has appeared desperate to acquire either Sprint or Clearwire as it looks to build up its portfolio of wireless spectrum and become a more prominent player in the US market.