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Softbank says Dish offer for Sprint 'illusory'

April 30. 2013 1:39PM
Associated Press

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(AP) The CEO of Softbank, the Japanese cellphone carrier trying to buy a majority ownership in Sprint, said Tuesday that a competing bid from Dish is based on "incomplete and illusory" numbers.

Dish Network Corp. has characterized its $25.5 billion bid for Sprint Nextel Corp. as superior to Softbank's. In a presentation Tuesday in Tokyo, monitored through a recorded webcast, Softbank Corp. CEO Masayoshi Son said the comparison is not "apples to apples" and omits crucial factors.

Softbank agreed in October to buy 70 percent of Sprint for $20.1 billion. The parties expect that deal to close July 1. Dish launched its competing bid for all of Sprint two weeks ago. A committee of Sprint's board is examining it.

Wall Street analysts view Dish's bid as superior but risky, as it will result in a combined company with high debt. Son said that Softbank's deal is worth 21 percent more than Dish's, all factors considered, and that the debt load will be far lower, relative to Softbank-Sprint's earnings.

In midday trading Tuesday, shares of Overland Park, Kan.-based Sprint fell 7 cents, or 0.9 percent, to $7.05. The share are trading well above the offer from either suitor, indicating that investors expect a sweetened bid from one of them.

Son said Softbank has no reason to raise its bid, as it's the superior one. Softbank can close the deal up to a year faster than Dish and brings industry expertise and cash to Sprint, he said. In addition, the combined Softbank and Sprint will be a huge purchaser of phones and network equipment, which should help it secure volume discounts, he said.

Dish had no immediate response Tuesday, but has said before that its debt load after an acquisition would not be excessive, considering today's low interest rates. Dish is also bringing added spectrum, or space on the airwaves, to the combination. The Englewood, Colo., company hopes to provide a combined cell-and-satellite service that will let customers view TV on their phones, wherever they are.

Sprint is the third-largest cellphone carrier in the U.S., behind Verizon Wireless and AT&T.

Associated Press

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