Japanese operator SoftBank's $21.6 billion bid for Sprint (NYSE:S) is said to have received the approval of the FCC. Although the regulatory body has made no formal announcement Bloomberg citing people familiar with the deal, reported that two of the FCC's three commissioners have approved the transaction. That approval includes Sprint's offer to purchase the rest of Clearwire that it doesn't already own.
The FCC declined to comment on the report as did SoftBank and Sprint representatives. Nevertheless, if the report is accurate, FCC approval would represent the last major hurdle to the transaction, which would give SoftBank 78 percent ownership of Sprint. Last week, Sprint shareholders approved the deal. Both Sprint and SoftBank have said they expect the deal to formally close early this month.
SoftBank has faced numerous obstacles in its acquisition of Sprint, primarily from Charlie Ergen's Dish Network (NASDAQ: DISH), which attempted to outbid the company. SoftBank revised its original proposal to counter Dish's $25.5 billion counterbid and Dish subsequently abandoned its attempt to get Sprint.
Under the revised deal with SoftBank, Sprint shareholders will get more money and Sprint will get less cash than originally proposed. Sprint shareholders will be paid $5.50 per share instead of $4.02 under the old agreement. SoftBank will get shares from existing Sprint investors for $7.65 per share, up from the previous offer of $7.30.
Central to SoftBank's bid for Sprint is Sprint's attempt to acquire the rest of Clearwire (NASDAQ:CLWR) it does not already own. Dish has offered $4.40 per share for Clearwire, but Sprint recently increased its bid for Clearwire to $5 per share, and has since received support from Clearwire's board and minority shareholders. In addition, Crest Financial, which owns a big stake in Clearwire, said it is backing Sprint's purchase of the rest of Clearwire. Crest, which owns 8 percent of Clearwire, wrote in a letter to Clearwire shareholders that it intended to vote in favor of the merger after Sprint raised its offer to $5 per share up from $2.97 per share. Clearwire investors are scheduled to vote on Sprint's offer at a July 8 meeting.
At stake is Clearwire's trove of 2.5 GHz spectrum, which Sprint hopes to use for a TD-LTE offload network. Clearwire commands around 160 MHz of spectrum in the top 100 markets, and Sprint has said its Network Vision network architecture allows it to efficiently deploy TD-LTE on the airwaves.
SoftBank has pledged to introduce innovative pricing at Sprint as well as continue to invest in the company's network so it can gain market share from Verizon Wireless (NYSE:VZ) and AT&T Mobility (NYSE:T). The combined Sprint and SoftBank would be the sixth-largest telecommunications company globally by revenue and the second-biggest among mobile Internet carriers, according to data compiled by Bloomberg.
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