Clearwire (NASDAQ:CLWR) shareholder Crest Financial is seeking to discount the votes of minority strategic Clearwire investors such as Comcast and Intel ahead of a Friday vote on Sprint Nextel's (NYSE:S) improved $3.40 per share offer to take control of Clearwire.
Crest, which holds roughly 8 percent of Clearwire's public non-Sprint shares, has been waging a proxy battle to stop Sprint from buying the roughly 50 percent of Clearwire it does not already own, arguing that Sprint's bid, even via its improved offer, undervalues Clearwire. Sprint needs the support of 50 percent of Clearwire's minority shareholders to complete the transaction, which is contingent on the closing of SoftBank's $20.1 billion deal for 70 percent of Sprint.
Clearwire's strategic investors--Intel, Comcast and Bright House Networks--own roughly 26 percent of Clearwire's minority shares, according to Reuters, and plan to vote in favor of Sprint's purchase of Clearwire. But Crest is arguing the situation is unfair because those strategic investors have "pledged to support Sprint regardless of the alternatives available" and that "for all intents and purposes these are Sprint shares, and their votes should not be counted as minority approval."
Crest said it has filed litigation "to challenge Sprint's naked interference with stockholder democracy" and again urged shareholders to vote against Sprint's $3.40 per share offer, which it raised last week from $2.97. Clearwire declined to comment on Crest's letter.
"And we believe that if Sprint's bid for Clearwire is rejected, neither a Sprint-SoftBank nor Sprint-Dish transaction will ever actually materialize," noted David Schumacher, Crest's general counsel.
For its part, Clearwire again told shareholders to vote in favor of Sprint's bid, with Chairman John Stanton telling stockholders it is "quite simply the best strategic option for all stockholders." Sprint CEO Dan Hesse said last week that the $3.40 per share bid represents Sprint's "best and final" offer. Shareholders will vote on the proposal May 31.
- see this Clearwire release
- see this Crest release
- see this Reuters article
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