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Though it gives shareholders more cash, SoftBank's (SFTBF.PK) offer (I, II) for a 78% stake in...

Though it gives shareholders more cash, SoftBank's (SFTBF.PK) offer (I, II) for a 78% stake in Sprint (S +2.2%) values the company at $1.1B less ($27.8B vs. $28.9B) than its old offer for a 70% stake, says Janco's Gerard Hallaren. "We have little faith this proposal will succeed," he adds. However, the WSJ observes the offer "contains poison-pill provisions that make it considerably harder" for Dish (DISH +0.6%) to thwart SoftBank, and increases Sprint's termination fee to $800M from $600M. Dish, which has reportedly lined up $9B in financing commitments, has until June 18 to make its final offer. Sprint and Clearwire (CLWR +2.2%) are both up moderately.
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Comments (2)
  • tsaeger
    , contributor
    Comment (1) | Send Message
     
    Bandwidth is oil. Dish, SoftBank, and Sprint (first) are fracking for bandwidth.
    11 Jun 2013, 03:16 PM Reply Like
  • Ted Barac
    , contributor
    Comments (477) | Send Message
     
    Yes, the new deal values the company at about $1bn less, but there will be considerably fewer shares outstanding (as the primary share contribution, from Softbank into Sprint, will be lower under the new deal).

     

    Under the old deal, there would have been about 4.6bn shares outstanding, post-deal, versus about 4.0bn under the new deal. As such, the implied value/share goes up, under the new deal, which is what's important.

     

    Did anyone really believe that they would revise the terms negatively for shareholders and expect it to go through?
    11 Jun 2013, 04:38 PM Reply Like
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