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Retiring CEO Otellini steps up to bat for his partner

Sprint Nextel Corp. (S) finds itself in an unusual position.  The struggling third place carrier suddenly finds itself with not just one, but two large, highly attractive suitors vying for partial ownership in it.  Softbank Corp. (TYO:9984) struck first with a $20B USD bid last October.  Then came satellite TV superpower Dish Network Corp.'s (DISH)  $25.2B bid earlier this month.

Who should Sprint choose?  Shareholders are meeting June 12 to vote whether to finalize the Softbank deal; Softbank has graciously relaxed some terms of its deal to allow Sprint to seek information on the DISH bid.  But one of Sprint's top partners is already speaking out about who they want to see win the day -- and they're backing Softbank.

Intel Corp.'s (INTC) almost-retired chief executive Paul Otellini wrote a letter [PDF] to the U.S. Federal Communications Commission backing Softbank's bid over DISH's.  Addressing retiring FCC Chairman Julius Genachowski, he says that he recently traveled to Japan to meet with Softbank CEO Masayoshi Son who painted a "very compelling" vision of transforming Sprint into a high-speed LTE superpower.

He writes:
 
I simply wanted to add my name to the list of companies hoping that Softbank will be able to acquire Sprint, rather than Dish. Son-san’s vision to build a high speed competitive third national network is very compelling. We need this competition in the wireless space as the ATT/Verizon model is not giving that to consumers at this time. I just wanted you to know where I and Intel stand on this important matter.

According to Reuters, Intel is a key business partner of Softbank's.  While Intel also does a chunk of business with DISH, it appears to be firmly in Softbank's camp for this campaign.

Sources: FCC, Reuters



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RE: Needs a third player
By Samus on 4/30/2013 1:15:47 PM , Rating: 2
Apple wouldn't just partially buy sprint. The Softbank and Dish offers aren't complete buyouts, they're for a majority share (39%) or controlling share (51%) and neither are Apple's cup of tea.

A complete Sprint purchase would cost Apple at least $50 billion. I don't see them blowing half their warchest on an unprofitable cellular carrier.


RE: Needs a third player
By Samus on 4/30/2013 1:17:31 PM , Rating: 2
My bad, I see they are actually both majority share offers (70%/72%)


RE: Needs a third player
By mcnabney on 4/30/2013 3:23:15 PM , Rating: 2
Not even close. Sprint shares are around 7 right now and there are 3 billion outstanding shares. Apple could offer $24B in cash for the whole company and still be paying 12% over current price.

And buying a network makes some sense. Apple is losing their ability to charge extremely high prices for their devices, so choosing a carrier would help out quite a bit. Sprint wouldn't be the best choice though.

Merging with Verizon and buying out Vodaphone's minority stake would be the best platform for Apple.


RE: Needs a third player
By seamonkey79 on 4/30/2013 6:51:53 PM , Rating: 3
Oh I hope they don't do that, I don't want to have to find another carrier while waiting for Verizon to keep up with everyone else :-\


RE: Needs a third player
By BRB29 on 4/30/2013 3:22:33 PM , Rating: 2
$50 billion is much less than half their warchest


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