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Dish bails on Sprint acquisition to focus on Clearwire

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Dish (STOCK)
Dish (STOCK)

Dish Network has pulled out of the competition to buy third-place US wireless carrier Sprint after months of back-and-forth with competitor SoftBank. After seeing the Japanese operator table a buyout offer in October 2012, Dish countered with its own surprise bid in April, leading to some heated exchanges in the media. Reuters reports that Dish will instead focus on acquiring Clearwire Corp. The company issued a statement on its change of plans in the form of a press release, the full text of which is below:

“While DISH continues to see strategic value in a merger with Sprint, the decisions made by Sprint to prematurely terminate our due diligence process and accept extreme deal protections in its revised agreement with SoftBank, among other things, have made it impracticable for DISH to submit a revised offer by the June 18th deadline imposed by Sprint. We will consider our options with respect to Sprint, and focus our efforts and resources on completing the Clearwire tender offer.”

The boards of both companies have backed SoftBank and Sprint

Television provider Dish has been working to get a wireless network off the ground, trying to acquire both Sprint and Clearwire over the past several months. In both cases it's faced uphill battles: the two boards have backed SoftBank and Sprint, respectively, leaving Dish a lot of ground to make up with shareholders. In the case of Clearwire, Dish actually managed to win them over, but was hit with a lawsuit from Sprint yesterday seeking to scuttle the offer.

Dish's decision to give up on its plans for Sprint brings to a close one of the more animated battles we've seen in the wireless industry. The company's CEO Charlie Ergen had tried to argue that Dish is a better "cultural" fit for Sprint, and even drum up fears of a foreign buyout by drawing parallels between the Japanese SoftBank and the Dubai Ports World scandal. With Dish out of the race, government support solidified, and a recently sweetened offer from SoftBank, the sun is shining on next week's shareholder vote to decide the fate of the acquisition.