Clearwire Corp. (NASDAQ: CLWR) is getting the higher buyout price offer from Sprint Nextel Corp. (NYSE: S) that has been rumored to be coming. The new increased offer is at $3.40 per share in cash to acquire roughly the 50% stake in the company that Sprint does not already own. The deal values Clearwire at $10.7 billion on an enterprise basis.
Dish Network Corp. (NASDAQ: DISH) has tendered a competing offer for Clearwire at $3.30 a share.
Our biggest question is whether many of the key Clearwire shareholders will agree that the Sprint bid offers enough of a premium. Sprint’s prior buyout price was $2.97 per share and today’s offer is a 14% premium on top of that. At some point, it should be addressed that Clearwire shares had broken under the $1.00 mark before the Sprint-Softbank merger broke. It also should be pointed out that the new offer is a 162% premium to Clearwire’s closing share price the day before the Sprint-SoftBank discussions were first confirmed.
Clearwire dissidents may want to take note here. Sprint said, “The offer represents Sprint’s best and final offer.” The revised offer has been submitted to the Clearwire board of directors and is subject to its formal approval. Sprint even went on to say that Clearwire has received commitments from Comcast Corp. (NASDAQ: CMCSA), Intel Corp. (NASDAQ: INTC) and Bright House Networks. These companies collectively own about 26% of Clearwire’s shares not affiliated with Sprint and they are in support of the transaction.
Shares of Clearwire were halted and closed at $3.26 yesterday ahead of what was going to be a revised offer. Shares were up 6% at $3.46 before the halt against a 52-week range of $0.83 to $3.49.
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