SoftBank raises Sprint offer, wins key shareholder support

Tue Jun 11, 2013 6:16am EDT
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By Mari Saito and Sinead Carew

TOKYO/NEW YORK (Reuters) - Japanese mobile operator SoftBank Corp (9984.T: Quote) said it agreed with Sprint Nextel Corp (S.N: Quote) to raise its offer for the U.S. wireless carrier to $21.6 billion from $20.1 billion, as it fights off a counter bid by Dish Network Corp (DISH.O: Quote).

SoftBank's amended offer, Japan's biggest outbound deal, won the backing of hedge fund Paulson & Co, Sprint's second-biggest shareholder, which had earlier supported the Dish bid. Paulson said it would vote all its shares in favor of SoftBank's improved offer.

Under the new deal, SoftBank will buy shares from current Sprint shareholders at $7.65 each, up from the previous offer of $7.30 per share. The Japanese firm, led by billionaire founder Masayoshi Son, will increase its cash injection to Sprint shareholders to $16.6 billion, up by $4.5 billion, and will end up with 78 percent of Sprint, up from 70 percent in its previous bid, the companies said in a statement on Tuesday.

The revised agreement came a day before Sprint shareholders were due to vote on SoftBank's offer, which is up against a rival bid from U.S. satellite TV provider Dish Network worth $25.5 billion. [ID:nL2N0EM19H] That meeting has been put back until June 25.

In a brief statement, Dish said it "will analyze the revised SoftBank bid as we consider our strategic options," adding it still believes Sprint has tremendous value.

A person familiar with Dish's thinking said the company was unlikely to go away after the sweetened SoftBank offer. "They're moving the deckchairs around. It doesn't represent meaningful incremental value for Sprint shareholders," said the person, who asked not to be named. "SoftBank's revised offer is probably less than people would have expected them to come back with."

Charlie Ergen, Dish's billionaire chairman known for launching fierce takeover battles, said last month he could take on a bidding partner and even sell off non-core assets to pay down debt if a bidding war with SoftBank became too pricey.

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A woman walks past logos of SoftBank Corp at its branch in Tokyo June 11, 2013. REUTERS/Yuya Shino