Sprint Nextel (S) shares are up about 3% this morning, trading slightly below the $7.65 represented by Softbank’s new offer.
Today’s Mobile Minute:
Sprint shareholders will now get $7.65 a share, and more of their payment from Softbank will be cash. Softbank has increased the cash portion of its offer from $4.05 a share to $5.50 a share. So far the news has not boosted Sprint’s shares all the way to that $7.65 — they were trading around $7.30 last time we checked. Sprint says that Softbank’s revised offer represents a 52% premium to Sprint Nextel’s price before the merger was announced. The shareholder vote on the offer has been postponed until June 25.
“In the absence of a ‘binding’ and superior offer from DISH in the next week, we expect Sprint holders to accept the revised SoftBank offer,” said analyst Kevin Smithen of Macquarie Securities. “We believe that Son-san has acted in good faith in engaging Sprint holders as future partners while still allowing for a significant IRR for SoftBank holders.”
Sprint Nextel shareholders appear poised to do much better than the MetroPCS shareholders did when that company merged with T-Mobile USA. MetroPCS stock was trading around $13.50 just before the merger announcement, and after the 1-for-2 stock split and the cash payment that shareholders received, the value of an equivalent holding in the merged company today is just over $14.00 a share.
