6:36 a.m. | Updated
Sprint Nextel raised its bid for Clearwire to $5 a share on Thursday, hoping to knock out a rival offer from Dish Network.
The new offer, which values Clearwire at about $14 billion, is 47 percent higher than Sprint’s last proposal. It is also higher than Dish’s most recent bid of $4.40 a share.
Sprint is hoping to end a battle of weeks for Clearwire, an embattled wireless network operator that nonetheless has become the object of a bidding war.
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Sprint and Dish view the company as the key to transforming their wireless empires. Sprint, which already owns a 50 percent stake, plans to harness Clearwire’s wireless spectrum to expand its high-speed data network.
Dish is seeking to use Clearwire to move beyond satellite television into the bigger market of cellular service. At the same time, it may be seeking to accumulate a big minority position in the hopes of forcing Sprint into a partnership or other transaction.
At times, Clearwire has seemed a part of Dish’s bigger plans to buy control of Sprint itself, wresting it from an existing suitor, SoftBank of Japan.
But on Friday, Dish confirmed that it was ending its pursuit, saying in a securities filing that it had “decided to abandon its efforts to acquire Sprint.” That decision followed an announcement on Tuesday that Dish would not submit a new takeover bid, clearing the way for SoftBank of Japan to acquire a majority stake in Sprint for $21.6 billion.
On Friday morning at the annual shareholders’ meeting in Tokyo, Softbank’s chief executive, Masayoshi Son, said, “The tables have turned.”
“Of course, we cannot let down our guard. But we have taken a big step forward,” he said. “If all goes as planned, our acquisition should be complete by early next month.”
But Dish appeared focused on winning over Clearwire, emerging after months of silence with a surprise $4.40-a-share offer that delighted investors, many of whom viewed a series of bids from Sprint as too low.
Clearwire switched allegiances to Dish last week, deeming its bid superior. Sprint subsequently sued both companies in Delaware’s Court of Chancery, contending that their deal violated a shareholder rights agreement.
But Sprint’s new offer appears to have permanently won over a crucial group of shareholders. In a joint statement, Sprint and Clearwire said that they had signed commitments from four big shareholders: Mount Kellett Capital Management, Glenview Capital Management, Chesapeake Partners Management and Highside Capital Management.
Even if the new offer fails, the four investors — who together own 9 percent — have agreed to sell their holdings to Sprint.
Sprint contends it now has the support of shareholders who own about 45 percent of the non-Sprint shares. It needs more than 50 percent to prevail.
Clearwire agreed to pay $115 million to Sprint if it broke off their deal under certain circumstances.
“The Clearwire board and special committee have determined that the $5-per-share transaction with Sprint represents the best path forward for the company and is in the best interest of our unaffiliated stockholders,” Erik Prusch, Clearwire’s chief executive, said in a statement.
An analyst at BTIG, Walter Piecyk, wrote in a blog post on Thursday that he expected shareholders to approve the new Sprint offer despite any potential counterbids from Dish.
Dish did not have any immediate comment. A spokesman for Crest Financial, a Clearwire shareholder that has been among the most active opponents of Sprint’s offers, declined to comment.
Hiroko Tabuchi contributed reporting from Tokyo.