Sprint Nextel Corp. (S) sent a letter to Clearwire Corp.'s
(CLWR) board stating that some provisions of Dish Network Corp.'s
(DISH) proposal to acquire the broadband provider include issues
that potentially could block the deal, including needed approval by
Sprint and legal concerns.
Clearwire shares were down 2% at $4.39 in recent premarket
trading.
Sprint in the letter on Monday stated that it won't vote in
favor of the proposed deal and plans to enforce its legal and
contractual rights. Sprint also stated that it remains committed to
its own planned merger deal with Clearwire. Sprint already owns
about 50% of the broadband provider, but needs a majority of the
minority holders to approve the tie-up for it to move forward.
A Clearwire spokesman wasn't immediately available to comment on
Sprint's letter.
At issue is a provision requiring the nomination of three Dish
candidates for the Clearwire board, a provision that aims to give
Dish the right to veto certain actions by Clearwire and certain
Sprint rights as a Clearwire shareholder.
Dish Network has made competing bids for both Clearwire and
Sprint while both have pursued other suitors, and Dish most
recently came out with a raised bid for Clearwire less than 48
hours before a scheduled shareholder vote on the Sprint deal.
Clearwire had confirmed late Thursday that it would postpone the
meeting until June 13, giving it time to review the new Dish offer.
Dish's latest bid for Clearwire was for $4.40 a share, well above
Sprint's already improved offer of $3.40.
Sprint shares were down by a penny at $7.29 in recent premarket
trading. Dish shares closed Friday at $38.54 and were inactive
premarket.
Write to Tess Stynes at Tess.Stynes@dowjones.com
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