SoftBank Leader Says DISH Bid "Illusory"
Masayoshi Son, the billionaire CEO of Japanese telecom SoftBank, told a news conference in Tokyo that the DISH Network's counteroffer for Sprint Nextel was "incomplete and illusory."
Son claimed that even though SoftBank's $20.1 billion bid for Sprint was less on paper than DISH's $25.5 billion offer, it still had "superior value," and SoftBank was not going to get into a price war with DISH.
Not pulling any punches, Son laid right into DISH's claim that its bid was worth $7 a share. "Is it right? Is it true? Is it misleading," he asked. "I would say the number is wrong. Totally wrong."
The DISH price per share is actually lower than claimed, said Son, because it proposes completing the deal one year after SoftBank's July 2013 deadline, and it doesn't take into account the $600 million penalty that would be due SoftBank if Sprint backs out.
SoftBank's comparison of the two bids:
Son also undercut the DISH bid, saying that besides having no experience in mobile communications, the satellite pay TV provider was known for litigious behavior and had a history of claiming financing that was not there.
When asked about the synergies DISH could bring to a partnership with Sprint, Son asked, "Do you want to attach a satellite dish to your smartphone?" "Our leverage is much more healthy," he said.
Son fan mail
SoftBank's quest for Sprint received a boost last week when Intel CEO Paul Otellini emailed FCC chairman Julius Genachowski with an endorsement of SoftBank's bid for Sprint, the distant No. 3 U.S. mobile operator.
"Son-san's vision to build a high speed competitive third national network is very compelling," Otellini wrote. "We need this competition in the wireless space as the AT&T/Verizon model is not giving that to consumers at this time."
DISH had previously written to the FCC regarding SoftBank's bid for Sprint, but it was far from an endorsement.
Sprint's plan, DISH's letter of last December pointed out, "raises a number of issues deserving of careful consideration," including, "Is it in the public interest for a foreign company to control more spectrum below 3 GHz than any one other company in the United States?"
DISH's chairman, Charlie Ergen, again played the foreign card during the April 15 DISH conference call announcing the company's bid for Sprint.
"We certainly have an advantage on the Justice Department side because we don't go through a foreign ownership ... review. So there would be no controversy there with us as a U.S. company," he said.
Now that SoftBank's leader has come out swinging in the fight for Sprint, Ergen, who has certainly been battle-tested in the 30 years he has spent building his company into the No. 3 pay TV provider, will probably come out of his corner ready to start jabbing.
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The article SoftBank Leader Says DISH Bid "Illusory" originally appeared on Fool.com.Fool contributor Dan Radovsky has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Intel. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.