DISH Network Outbids SoftBank with $25.5 Billion Offer to Buy Sprint

Discussion in 'Android News' started by dgstorm, Apr 15, 2013.

  1. dgstorm

    dgstorm Editor in Chief Staff Member Premium Member

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    Toward the end of last year, Sprint got some good news as the Japanese company SoftBank began the process of buying the Now Network. The merger has been up and down, with some shareholders trying to hold out for more money, but for the most part everything seemed on track to create a more powerful and competitive Sprint. In fact, many of the regulatory hurdles have been already worked out, although there are some complicated aspects of the merger because Sprint themselves are in a battle to buyout ClearWire. However, a new bit of news today complicates things even further.

    DISH Network, the floundering satellite TV provider just entered a counter offer to buy Sprint outright that is a larger bid than SoftBank's. Here's a quote with the details,

    As you can see, the deal offered by DISH is a good one. It will be hard for investors to ignore, and, at the very least, will slow down the merger with SoftBank. If Sprint and its shareholders decide to entertain this offer seriously the question remains, "will SoftBank be willing to increase their offer to finish the deal?"

    It's hard to say which would have a better outcome in the future. On the one hand, if DISH did win the bid, that would mean keeping the ownership of Sprint in the United States, and it could help bolster DISH network to become a better digital wireless competitor. On the other hand, SoftBank is already a powerful and profitable company, and could offer beter future investment potential to help grow Sprint and make them more competitive with the other three big US carriers. Both options seem to have pluses and minuses. Which do you think would be the better option?

    Source: Yahoo!
     
  2. doomgazer

    doomgazer Member

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    Assuming Charlie has any major say in the new company, I can see a lot more litigation and a lot less progress than we might otherwise see with a different company. Charlie is notorious for loving a good court battle, resulting in network blackouts on Dish fairly regularly during contract disputes.

    I do however, like the idea of the company remaining wholly owned by US based investors.
     
  3. liftedplane

    liftedplane Senior Member

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    why? would it not help to have a fresh outlook from another country on how to run a cellular phone company? the Japanese do seem to have it a bit better than us.
     
  4. kodiak799

    kodiak799 Silver Member

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    Where in heck does DISH get the money to do this deal?!?

    Two struggling companies? I'm not sure how combining them is going to help. Maybe I'm just not seeing it, but I can't think of many synergies or capabilities to leverage.
     
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  5. dgstorm

    dgstorm Editor in Chief Staff Member Premium Member

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    I was wondering the same thing kodiak. I thought DISH was hurting. How did they get someone willing to lend them $20+ Billion?
     
  6. kodiak799

    kodiak799 Silver Member

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    They're market cap is only $16.7B! Although smaller companies HAVE bought out larger ones before...the offer is supposedly $17B in cash and $8B in stock. Not sure where they would get the cash, because I'd assume they are already pretty highly leveraged (but I haven't seen a financial statement).

    Dish also expects the proposed combination will result in synergies and growth opportunities estimated at $37 billion in net present value. This includes an estimated $11 billion in cost savings, representing about $1.8 billion in annual run-rate cost synergies by the third year after closing. Dish intends to fund the $17.3 billion cash portion of the deal using $8.2 billion of balance sheet cash and additional debt financing.

    ^^^LOL at the bolded.

     
  7. Lucas5

    Lucas5 Member

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    Doesn't Dish Network own some decent wireless spectrum? Whichever way this goes, I think that it's a good thing. I'd like to see the two small guys (tmobile and sprint) grow and give the other two big guys (verizon and att) some good competition.
     
  8. kodiak799

    kodiak799 Silver Member

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    Excellent point. I'm maybe off-base with a lack of knowledge here.

    One could imagine some bundled deals for cell/cable that are appealing. But, again, you're fighting for the scraps of marginally profitable customers.
     
  9. wvdroidman

    wvdroidman Member

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    either way I see dish and directv trying to merge again to compete with the likes of Comcast and time warner. Somehow I think this transaction might play into their plans to merge.
     
  10. liftedplane

    liftedplane Senior Member

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    Wth for some reason Tapatalk is linking wvdroidman's post to a very old forum post

    Either way I'd love to see a dish directv merger. Especially with the new hopper and genie DVR.

    ---
    I hate jelly beans, Google's jellybean is alright though.

    Sent from my sickeningly sweet Galaxy Note II
     
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