Dish Gives Up on Clearwire

Satellite Giant Withdraws Tender Offer

Dish Network threw in the towel on its attempt to acquire WiMax pioneer Clearwire, officially withdrawing its tender offer for the company Wednesday.

In a terse statement, Dish said it was withdrawing its offer “as a result of the recent change in recommendation by Clearwire.”

Dish had offered to pay Clearwire shareholders $3.30 per share for their stock in January,  a move that seemed to trump Sprint Nextel’s $2.97 per share offer for the remaining 49% in the WiMax pioneer it didn’t already own. Sprint upped the ante to $3.40 per share in May, followed later that month by Dish’s $4.40 per share tender offer. On June 20, Sprint raised the bar again to $5 per share. Also on that date, a special committee of Clearwire’s board of directors recommended shareholders accept the Sprint offer.

This makes Dish 0-for-two in its recent M&A dealings with Sprint. The satellite giant dropped its $25.5 billion bid for a 100% interest in the wireless carrier on June 18, after a revised bid from SoftBank. The loss of Clearwire now brings into question what Dish and chairman Charlie Ergen will do with its wireless spectrum. Reports have speculated that Dish could sell its spectrum, focus its attention on pursuing a merger with the nation’s largest satellite TV service provider DirecTV, or attemp to acquire another wireless company like T-Mobile.

In an e-mail message, Pivotal Research Group principal and senior media & communications analyst Jeff Wlodarczak wrote Ergen is running out of options to buy wireless carriers and is unlikely to build a wireless broadband network on his own.

“If [T-Mobile] does not happen (which I view as unlikely), the most likely options are to sell the spectrum and or the company with DirecTV and AT&T being the most likely buyers,” Wlodarczak wrote.