Dish Network has withdrawn its bid for a minority stake in Clearwire only days after the US wholesaler’s board recommended an improved offer from Sprint.
In a statement, Dish said it had pulled its bid, “among other reasons”, as a result of the recent change in recommendation by Clearwire (which had previously backed Dish).
Another reason could be the lawsuit that Sprint filed against Dish for what it claimed to be an unlawful bid by the satellite TV broadcaster for the Clearwire stake that it doesn’t already own.
Sprint, the third-largest mobile operator in the US, owns 50.2 per cent of Clearwire.
It has been a dreadful few days for Charlie Ergen, the Dish chairman, who saw his takeover bid for Sprint go up in smoke after Japan’s SoftBank’s revised offer for the mobile operator was accepted overwhelmingly by Sprint shareholders on 25 June.
If Ergen had pursued his bid for Clearwire’s valuable spectrum assets, it would also mean doing battle once more with Masayoshi Son, SoftBank’s chief executive, who will no doubt help fund Sprint’s improved bid for the remaining Clearwire stake assuming the FCC – the US telecoms regulator – gives the SoftBank takeover of Sprint its blessing.
And even if Dish could convince the Clearwire board to change its mind once again with a sweetened offer, it’s unlikely Ergen would relish the prospect of working with Son given the acrimonious exchanges between the two in the bidding for Sprint.
That may well be another reason why Ergen has decided to pull out of the Clearwire race.
Clearwire’s minority shareholders will vote on the Sprint bid on 8 July.
There is some analyst speculation that Ergen’s attentions will now move elsewhere to get into the US mobile market with T-Mobile US – 74 per cent owned by Deutsche Telekom – mentioned as one possible target.
“I don’t think they’ve given up on wireless. They need to have access to one of the wireless operators’ subscriber base,” said Todd Mitchell, Brean Capital analyst, in reference to Dish in a Reuters report.