Sprint has increased its offer to acquire the approximately 50 percent of Clearwire it does not currently own to USD 5.00 per share, valuing Clearwire at approximately USD 14 billion, or about USD 0.30 per MHz pop. This increased offer represents a 47 percent premium to Sprint's previous offer of USD 3.40 per share announced on 21 May and a 285 percent premium to Clearwire's closing share price on 10 October 2012, the day before the Sprint-SoftBank discussions were first confirmed in the marketplace and Clearwire was speculated to be part of that transaction.
This offer also represents a 14 percent premium to the USD 4.40 per share offer Clearwire previously agreed with Dish Network. As a result Clearwire has switched its support to the Sprint offer. It announced that its board of directors, based on the unanimous recommendation of the Special Committee consisting of independent, non-Sprint-affiliated directors, recommended that stockholders accept the revised offer from Sprint.
Sprint has received commitments from a group of significant Clearwire stockholders, including Mount Kellett Capital Management, Glenview Capital Management, Chesapeake Partners Management and Highside Capital Management LP, which collectively own approximately 9 percent of Clearwire's voting shares, to vote their shares in support of the transaction. These stockholders have also agreed to sell their shares to Sprint in the event the transaction does not close.Together with voting commitments previously received from Comcast, Intel and Bright House Networks, who collectively own 13 percent of Clearwire's voting shares, and Clearwire's directors and officers, stockholders owning approximately 45 percent of the Clearwire voting shares not affiliated with Sprint, have now agreed to vote their shares in support of the transaction.
In addition to the increased price per share, the companies have further amended the merger agreement that was previously entered into. Specifically, among other things, in certain circumstances where the transaction between Sprint and Clearwire terminates, Clearwire will be required to pay a termination fee of USD 115 million, or 3 percent of the equity value of the minority stake.
