HOUSTON, June 3, 2013 /PRNewswire-USNewswire/ -- Crest
Financial Limited, the largest of the independent minority
stockholders of Clearwire Corporation (NASDAQ: CLWR), again urged
the Clearwire Board of Directors to give genuine consideration to
DISH Network Corporation's $4.40 per
share tender offer and to pursue an "open, competitive bidding
process" for Clearwire. Crest also described the options
Sprint faces now that the competitive bidding over Clearwire has
begun, and it demanded that the Clearwire Board form a new Special
Committee with new independent directors to ensure a "fair and
transparent" bidding process.
In Crest's letter to the Clearwire Board, David K. Schumacher, Crest's General Counsel,
stated: "DISH's tender offer has shifted the battle for Clearwire's
valuable assets to where it belongs—a competitive bidding process
for Clearwire. But for a truly competitive process to take
place, the Clearwire Board must appoint a new Special Committee
with new, truly independent directors, unmarred by the Clearwire
Board's past mistakes. The prior Special Committee failed to
protect all stockholders' best interests by acceding to Sprint's
two low-ball offers, locking the Company into coercive financing
and corporate governance terms, and delegating all negotiating
authority away from the Special Committee's members to Mr. Stanton,
among many other things. The same abdication cannot occur
this time around."
According to Schumacher: "There are currently two bids on
the table for Clearwire—one from the controlling stockholder and
one from another bidder. For a fair assessment of each, a
fresh independent perspective is required. Moreover, new
independent directors will serve as a bulwark against any more
attempts at oppression by Sprint. Thus, for Clearwire's
minority stockholders to make a truly free choice, you must
delegate to the new Special Committee all the powers of the Board,
including decisions regarding interim financing and corporate
governance arrangements, and Mr. Stanton must give up all
negotiation authority. Then, the new Special Committee must
fully consider DISH's offer, while also entertaining competing bids
from Sprint, SoftBank, and all other interested parties."
Schumacher added: "Sprint now faces two options.
First, unless Sprint and its current suitor, SoftBank, wish to
cohabitate with DISH as joint owners of Clearwire, they need to
counter DISH's tender offer with a real offer that reflects
Clearwire's full and fair value. That is the only way Sprint
and SoftBank could take Clearwire private as they planned and deny
DISH a stake in the Company. We believe, despite SoftBank CEO
Masayoshi Son's earlier
protestations, that such cohabitation in Clearwire is untenable to
both Sprint and SoftBank. If Sprint pursues this option, the
reconstituted Clearwire Special Committee should take all steps
necessary to ensure that any further bids from Sprint reflect full
value and do not capitalize on the imbedded diversion value that
has been indicative of Sprint's offers thus far. Second, if
Sprint is unable, or SoftBank is unwilling to permit Sprint, to
raise its bid to top DISH's latest offer (and any future bids),
then Sprint can avoid deadlock at Clearwire only by shifting its
allegiance away from SoftBank and toward DISH in its own sale
process. In this scenario, we believe that DISH will want its
subsidiary Sprint to control 100% of Clearwire. And if this
scenario occurs, you must ensure that any offer that DISH puts
forward reflects the full value of the Company."
Schumacher noted: "Either case described above provides the
Board and the Special Committee with another opportunity to realize
the full value of Clearwire for all stockholders. That is why
we have urged you to recommend against Sprint's proposed merger,
close the polls in the pending stockholder meeting, and, upon the
Clearwire stockholders' rejection of the Sprint merger, terminate
the ill-advised and oppressive merger agreement with Sprint.
Such clearing of the decks would afford a real opportunity for a
competitive bidding process for Clearwire."
Crest's letter continues: "Of course, there remains the
possibility that DISH and Sprint elect to share governance of
Clearwire. If Clearwire remains an independent, public
company going forward, the Company can resume the course it charted
before Sprint's attempted squeeze-out. DISH's offer, and its
clear intent to enter into a commercial arrangement that provides
it with access to Clearwire's spectrum, kickstarts the profitable
multi-customer case strategy (the "MCC strategy") that the Board
thus far has claimed to be elusive. This MCC strategy,
proposed by Clearwire's own management and reviewed by its
financial advisers, could push the Company's value as high as
$16.76 per share, according to
Clearwire's own financial advisor, Evercore Partners. As
presented by Clearwire's management, the MCC strategy would
increase free cash flow and improve the Company's leverage to
negotiate higher commercial rates with Sprint, DISH, and any other
wholesale customer in the future. In addition, the Company
could resume the common stock offering that it started last year,
but then abruptly halted. At Clearwire's current share price,
such an offering would substantially reduce the dilution of the
convertible notes proposed by Sprint and DISH and generate the
necessary capital to fully deploy Clearwire's TDD-LTE
network. Additionally, the Company could now refinance its
existing bonds at more attractive rates, thereby improving cash
flow."
Schumacher further stated: "For all these favorable alternatives
to become available, however, you need to consider properly DISH's
tender offer, which is clearly actionable. Unless and until
you fully consider the alternative that DISH has offered, Sprint
might continue its pattern of unfair dealing and broker a deal
between SoftBank and Sprint to avoid a bidding contest for
Clearwire. You must not allow that to occur.
Notwithstanding the Board's previous efforts to provide every
advantage to Sprint to the detriment of the Company's other
stockholders, the minority stockholders have thus far beaten back
Sprint's self-interested attempts to lock up Clearwire on the cheap
while selling itself at a premium. It is time that the
Clearwire Board fulfills its duty to do the same and obtains a
premium for Clearwire's stockholders other than Sprint. The
newly constituted Special Committee we are demanding should ensure
that we and our fellow stockholders will have the option to act on
offers that are superior to Sprint's currently inadequate offer,
whether that is DISH's tender offer, another offer from Sprint, or
an offer from yet another third party."
The letter to the Clearwire Board concludes: "[T]he
competition for Clearwire has only just begun, and you have an
obligation to make sure it proceeds in a fair and transparent
manner. We thus urge you to reconstitute the Special
Committee, give full consideration to DISH's tender offer, open the
Company to a competitive bidding process, and prevent Sprint from
diverting Clearwire's value back to itself."
D.F. King & Co, Inc. has been
retained by Crest to assist it in the solicitation of proxies in
opposition to the proposed Sprint-Clearwire merger. If stockholders
have any questions or need assistance in voting the GOLD proxy
card, please call D.F. King &
Co. at (800) 949-2583. The full letter to the Clearwire Board can
be found at http://www.dfking.com/clwr or
http://www.bancroftpllc.com/crest.
About Crest Financial Limited
Crest Financial Limited
("Crest") is a limited partnership under the laws of the
State of Texas. Its principal
business is investing in securities.
Important Legal Information
In connection with the
proposed merger of Clearwire Corporation ("Clearwire") with Sprint
Nextel Corporation (the "Proposed Sprint Merger"), Crest and other
persons (the "Participants") have filed a supplement to its
definitive proxy statement with the U.S. Securities and Exchange
Commission ("SEC"). The definitive proxy statement and the
supplement have been mailed to the stockholders of Clearwire.
SECURITYHOLDERS OF CLEARWIRE ARE URGED TO READ THE DEFINITIVE PROXY
STATEMENT AND THE SUPPLEMENT, WHICH ARE AVAILABLE NOW, AND THE
PARTICIPANTS' OTHER PROXY MATERIALS FILED WITH THE SEC WHEN THEY
BECOME AVAILABLE, BECAUSE THEY CONTAIN IMPORTANT INFORMATION,
INCLUDING ADDITIONAL INFORMATION RELATED TO THE PARTICIPANTS,
CLEARWIRE AND THE PROPOSED SPRINT MERGER. The definitive proxy
statement, the supplement and all other proxy materials filed with
the SEC are available at no charge on the SEC's website at
http://www.sec.gov. In addition, the definitive proxy
statement and the supplement are also available at no charge on the
website of the Participants' proxy solicitor at
http://www.dfking.com/clwr.
Forward-looking Statements
Certain statements
contained herein are forward-looking statements including, but not
limited to, statements that are predications of or indicate future
events, trends, plans or objectives. Undue reliance should not
be placed on such statements because, by their nature, they are
subject to known and unknown risks and
uncertainties. Forward-looking statements are not guarantees
of future activities and are subject to many risks and
uncertainties. Due to such risks and uncertainties, actual
events may differ materially from those reflected or contemplated
in such forward-looking statements. Forward-looking statements
can be identified by the use of the future tense or other
forward-looking words such as "believe," "expect," "anticipate,"
"intend," "plan," "should," "may," "will," believes," "continue,"
"strategy," "position" or the negative of those terms or other
variations of them or by comparable terminology.
SOURCE Crest Financial Limited