Sprint sent a letter to the board of acquisition target Clearwire, stating that a bid for the company made by US satellite broadcaster Dish Network is “not actionable”.
The US number three operator said that certain provisions of Dish’s offer “violate Delaware law, Clearwire’s certificate of incorporation or the rights of the parties to the existing Clearwire Equityholders Agreement (EHA), including Sprint”.
Last week, Dish upped its offer for Clearwire to $4.40 per share, trumping Sprint’s latest offer of $3.40.
This came shortly after Clearwire said that it had “not had any substantive discussion” with Dish in recent weeks, having previously noted that “a sale to a third party other than Sprint is unlikely to occur due to Clearwire’s governance structure and Sprint’s unwillingness to sell its stake”.
In a statement yesterday, Sprint said that it will “not vote in favour of the proposal, tender its shares in the offer or waive any of its rights as a stockholder or under the EHA. Having invested billions of dollars in Clearwire, Sprint intends to enforce its legal and contractual rights, which are fundamental to investments it made”.
It continued: “Dish has had five months to modify its proposal into an actionable transaction. Rather than proposing a workable transaction, Dish waited until the eve of the Clearwire stockholder meeting to again propose the transaction it would like to have while assuming Delaware corporate law, the EHA and Clearwire’s certificate of incorporation did not exist.”
When it received its updated offer from Dish, Clearwire said that it “appears to be more actionable than Dish’s previous proposal”, and that it would engage with the company “consistent with its fiduciary duties”.
A special meeting of Clearwire stockholders had been called for 13 June 2013.