walter reed insight: mobile consolidation picks up speed
DESCRIPTION
Walter Reed, partner at Edwards Wildman, explains the recent trend of mobile consolidation.TRANSCRIPT
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© 2012 Edwards Wildman Palmer LLP & Edwards Wildman Palmer UK LLP
Walter Reed, Edwards Wildman InsightMobile Consolidation Picks Up Speed
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Strategic Consolidation Deals
Mobile carriers are working together to get the best spectrum for their companies, and the deals are making the headlines:
♦ Sprint To Buy Out Clearwire (December 2012)
♦ Will Dish Get Clearwire (January 2013)
♦ AT&T Will Buy Some Verizon Spectrum for $1.9 Billion (January 2013)
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Sprint To Buy Out Clearwire
♦ In December, Sprint made a $2.2 billion offer to buy the remaining 50% stake of Clearwire (it already owns the other 50%). The deal is still being reviewed.
♦ Sprint was able to make the offer due to a $20.1 billion transaction agreement with SoftBank of Japan this past October.♦ Sprint has already received $3.1 billion in convertible debt. The
rest of the transaction is to be done after regulatory approval.♦ The DOJ, FBI and Department of Homeland Security are now
investigating the merger for national security and law enforcement issues.
♦ Also of note, Sprint’s purchase of Clearwire is contingent on its ability to complete the Softbank deal
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Will Dish Get Clearwire?
♦ About one month after Sprint offered to buy Clearwire, Dish made an unsolicited move for the company.
♦ Dish outbid Sprint, offering to pay $3.30 per share, or $5.15 billion.
♦ To make the deal even sweeter for Clearwire, Dish is offering to buy 24% of Clearwire’s spectrum for $2.2 billion and provide $800 million of additional financial support.
♦ Analysts believe that Clearwire will not accept Dish’s offer due to various factors, including the fact that Sprint already owns a majority stake in Clearwire, and Clearwire can’t sell spectrum without Sprint’s consent.
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AT&T Will Buy Some Verizon Spectrum for $1.9 Billion
♦ AT&T has signed an agreement to buy spectrum licenses from its main competitor, Verizon, for $1.9 Billion
♦ This purchase will cover 42 million people across 18 states, expanding AT&T’s 4G LTE network
♦ AT&T’s LTE has been deployed in 135 cities, whereas Verizon has LTE in 476 cities.
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Walter Reed’s Insight on Mobile Consolidation
“News of Dish’s unsolicited offer to buy the remainder of Clearwire was a major shock to the mobile industry and my colleagues at Edwards Wildman…Dish’s offer was higher than Sprint’, but it’s hard to believe that the bid will result in a deal.”
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“In the end, technology is moving quickly, but change seems to be slow-going. This deal is certainly an important one for Sprint and Clearwire, but consumers might have to be patient to see any noticeable changes.” – Walter Reed
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More Information on the Mobile Market
♦ For more information on the mobile market from Walter Reed, Partner at Edwards Wildman, please visit:
♦ Insight on AT&T’s Spectrum Purchase from Edwards Wildman
♦ Dish v. Sprint: It’s Up To Clearwire
♦ Walter Reed on the Changing Mobile Market (video)
♦ What to Expect from Major Mobile Carriers in 2013 (video)
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© 2012 Edwards Wildman Palmer LLP & Edwards Wildman Palmer UK LLP
For more information on Walter Reed, please visit:
www.WalterReedEdwardsWildman.com
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© 2012 Edwards Wildman Palmer LLP & Edwards Wildman Palmer UK LLP
For more information on Edwards Wildman, please visit:
EdwardsWildman.com