Hello! And welcome to our Friday column, Worst of the Week. There’s a lot of nutty stuff that goes on in this industry, so this column is a chance for us at RCRWireless.com to rant and rave about whatever rubs us the wrong way. We hope you enjoy it!
And without further ado:
There is nothing like desperation to make someone sweat. And there is nothing like the smell of sweat to tell when someone is desperate. Some may call it sweet, but I prefer to refer to it only in the fact that it’s indeed sweet when someone is sweating due to desperation. (Myself excluded.)
What does this jumble of words have to do with the price of bread? Not much, except that it is pretty sweet watching Clearwire sweat it out over its proposed acquisition by Sprint Nextel. That sweating was evident when the carrier sent out a “reminder” to shareholders to vote for the proposed $2.2 billion transaction, and not against it. This reminder was sent just days after Clearwire Chairman and long-time industry veteran of such M&A activity John Stanton sent out his own letter laying out why investors should approve the deal.
Desperate much?
The note reminds shareholders to vote “FOR” the proposal using “the WHITE proxy card” provided. Sounds simple enough, though I always find it odd that these sorts of deals rely on colored cards to show which way someone want to vote.
What, are we back on Sesame Street?
Clearwire also adds a nice motto to go along with its plea:
“Maximize the value of your investment in Clearwire – vote “For” the Sprint transaction on the white proxy card today.”
(If Clearwire investors really wanted to maximize the value of their investment they would invent a time machine and go back to mid-July 2007, when each one of their stocks was worth more than $35 per share, but that’s another story.)
I understand the need for Clearwire’s management to garner support for this deal, seeing how the company is set to run out of money in the coming months and with Sprint Nextel already having a controlling interest in the carrier that it has hinted it would use to block any other deal, there really is no way out for Clearwire.
I also understand that investors want to squeeze as much money as possible out of this deal, because that’s what investors are supposed to do. I am also guessing that the recent capitulation by Deutsche Telekom in order to get the merger between T-Mobile USA and MetroPCS completed has also had something to do with this investor confidence.
“What’s the big deal Sprint? Just throw in a couple hundred million more dollars and we will make this all go away.”
Also, I would guess that if any other company besides Sprint Nextel was involved with this deal, it would have gone along swimmingly. But, as has become its lot in life, nothing Sprint Nextel is ever involved with can be easy. While I do admire that Sprint Nextel has managed to get to where it is today (wherever that is) through the most self-inflicted pain imaginable is indeed impressive. But, seeing how those Clearwire investors are looking to stick it to Sprint Nextel for just a bit more money does seem a bit mean spirited.
Of course, many of those investors have their eye on Dish Network’s proposed “superior” offer to the Sprint Nextel deal as their El Dorado. Sure, there might be a few more bucks in the Dish “offer,” but again, Sprint Nextel has no intention of signing off on that and it seems that Dish has moved on to bigger prey.
But, I am also guessing that Sprint Nextel shareholders are themselves watching these proceedings very closely as they will also be voting soon on a potential acquisition by Softbank. My guess is that those who may be complaining about increasing the offer for Clearwire today will be using a similar tack in the months to come.
I am sure at the end of the day, all of this mess will be smoothed over with Sprint Nextel having secured full control over Clearwire for something north of $2.2 billion; for Sprint Nextel to then be acquired by Softbank for something north of $20 billion; and for Sprint Nextel to again at some point make a decision that makes everyone scratch their heads.
In the meantime, let’s enjoy this moment of desperation. It’s not every day the air smells so sweet.
OK, enough of that.
Thanks for checking out this week’s Worst of the Week column. And now for some extras:
–Don’t get me wrong, I like technological advancements as much as the next guy. (To support that claim I would like to show off my extensive Laser Disc collection.)
However, claims this week from Samsung that they had somehow got the jump on the competition in terms of “generational” technology enhancements does not seem right as the company announced this week some sort of breakthrough in “5G” technology.
Look, I know everyone has already had it with “4G” thanks to all the great marketing around said term. (Thanks marketing community! Now my mom is asking me questions about “4G.”) But, are we really to begin this “5G” talk? Can’t we first allow the term “4G” to be overused to the point of nausea? Oh wait, I think we are already there. Welcome 5G!
–With the final spring CTIA show just around the corner, I thought I should at least make a mention of what I am looking forward to from that event. That would be getting my hands on the new Caterpillar Cat Phone. I am hoping that as a demo for the device they let me drive a Caterpillar tractor over it.
I welcome your comments. Please send me an e-mail at dmeyer@rcrwireless.com.
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