Crest Holds Out For More

It’s the endgame for Sprint’s Clearwire campaign, but it’s not over yet. Despite Sprint’s decision to boost its bid from $2.97 to $3.40 in the wake of shareholder protests, the deal’s biggest detractor remains unimpressed. Yep, Crest Financial is still recommending a ‘No’ vote next Friday.

In the SEC filing, they indicated it would be better to remain independent and start a full auction, hoping to demonstrate just how much gold all that spectrum is really worth. Sprint could kill any such auction by virtue of its majority position, but on the other hand Crest and its allies hold 18.2% of the class A common stock.

That means, I think, that since Sprint needs a majority of the minority to win the vote, the opposition has already three quarters of the votes it needs to win this round of chicken. And a game of chicken is what it will be if this deal falls through, since I doubt either side would enjoy a trip through BK court. Someone will have to blink, and Crest is probably hoping for another bump up in Sprint’s bid if nothing else.

The new offer of $3.40 per share was clearly arrived at as a nod to the market’s opinion of a fair final bid. However, even if it carry the vote it’s going to be pretty close any way you count it.

Meanwhile, Dish is busy in another corner of the wireless market. They’ve signed a letter of intent to pursue a strategic relationship with nTelos. The idea is a fixed-mobile broadband offering in nTelos’s territory, which means West Virginia and rural swaths of the surrounding states — which don’t happen to be terribly well served with bandwidth.

Just where that fits in with DISH’s bid for Sprint and its stalking horse bid for LightSquared’s spectrum and its previous interest in Clearwire – who’s to know.

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Categories: Mergers and Acquisitions · Wireless