Sprint looks set to secure its brace of major deals at last, with the FCC said to favor Softbank’s acquisition of a 78% stake in the US cellco, and Clearwire shareholders coming round to Sprint’s offer for full control of that venture.
Crest Financial, which has consistently opposed Sprint’s bids for the almost-50% of Clearwire it does not own, has reversed its position and now supports the takeover. The insistence of Crest and other shareholders that Sprint was undervaluing Clearwire’s spectrum helped to bring Dish into the race and boost the price to the current offer of $5 a share ‘ 68% higher than Sprint’s initial bid of $2.97 a share back in December.
Dish has now dropped out of the battle to buy majority stakes in Sprint and/or Clearwire, leaving only a few hurdles in the way of the Softbank/Sprint alliance (in which control of Clearwire and its plentiful 2.5GHz spectrum is a major attraction for the Japanese firm). Crest’s change of heart all but ensures that Clearwire’s shareholders will approve Sprint’s offer at a vote on July 8, though final regulatory approval is also required.
In a letter to Clearwire shareholders, included in a regulatory filing on Wednesday, Crest said it was “now satisfied with these terms’, and added: “We have agreed with Sprint and Clearwire to cease opposition to the transaction and to vote in favor of the merger.’ It also said it was withdrawing any “statements made in the heat of battle that may be construed as disparaging to Clearwire, Sprint, their directors and officers’, while Sprint will reimburse Crest up to $2.5m for “documented costs and expenses” related to its proxy fight.
Meanwhile, Bloomberg reported that two of the three FCC commissioners had voted in favor of Softbank’s $21.6bn deal for control of Sprint, which would be the final approval needed for the transaction to be finalized. The FCC has not officially commented yet.