Industry Expert Finds DISH’s Claimed Synergies with Sprint Unsubstantiated
Analysis and Additional Shareholder Information Now Available at
TOKYO -- May 7, 2013
A new study by a leading industry expert, Scott C. Chandler, Managing Director
of Franklin Court Partners, LLC, disputes recent claims made by DISH Network
Corporation (NASDAQ: DISH) (“DISH”) regarding the value of synergies that
might be created in the event of a merger between DISH and Sprint Nextel
Corporation (NYSE: S) (“Sprint”). The analysis finds that DISH’s estimate of
the net present value of synergies created in the proposed DISH/Sprint merger
“is unusually high and there are multiple reasons to believe that DISH’s
projections are neither achievable nor credible.”
The Franklin Court Partners study, along with other shareholder information,
can be found at a new transaction website launched today by SoftBank. Below is
a brief summary of the report’s findings.
*DISH’s projected cost synergies are predominantly non-network based and
are far higher than non-network synergies projected by acquirers in other
large wireless transactions.
*The claimed synergies are likely harder to achieve than in other recent
wireless transactions because a DISH/Sprint merger would combine two
dissimilar companies which operate in different sectors.
*DISH projects that it will achieve its cost synergies at a much faster
rate. DISH projects achievement of 70% of the cost synergies in the first
year, more than twice the rate in other wireless mergers.
*DISH fails to account for integration costs, which could be in the range
of $2.5 - $3.5 billion.
*DISH’s claimed revenue synergies are unreasonably large, far exceeding
claims made in prior wireless transactions.
*DISH provides little information regarding the components of its projected
revenue synergies. The revenue growth to achieve these synergies runs
counter to the current industry structure of slow growth and saturation in
each of the competitive Pay TV and wireless telecommunications sectors.
In preparing the analysis, Franklin Court Partners was assisted by the staff
of the economic consulting firm Cornerstone Research.
SoftBank continues to believe its agreement with Sprint creates significantly
greater value for Sprint stockholders than the highly-leveraged preliminary
proposal put forward by DISH and remains committed to completing its
transaction on the terms previously disclosed. SoftBank anticipates closing on
July 1, 2013, subject to satisfaction of closing conditions, including receipt
of all necessary regulatory approvals.
The Franklin Court Partners study, which was commissioned by SoftBank, can be
found along with other information relevant to the SoftBank-Sprint transaction
The Registration Statement and proxy materials related to the merger agreement
are available at Sprint’s website at www.sprint.com/investors. If you have any
questions or need assistance in voting your shares, please call Sprint’s proxy
solicitor and the information agent for the offering, Georgeson Inc., toll
free at 1-866-741-9588 (banks and brokers call 212-440-9800). You can also
contact SoftBank’s proxy solicitor Morrow & Co., LLC toll free at
1-800-662-5200 (banks and brokers call 203-658-9400).
Cautionary Statement Regarding Forward Looking Statements
This document includes “forward-looking statements” within the meaning of the
securities laws. The words “may,” “could,” “should,” “estimate,” “project,”
“forecast,” “intend,” “expect,” “anticipate,” “believe,” “target,” “plan,”
“providing guidance” and similar expressions are intended to identify
information that is not historical in nature.
This document contains forward-looking statements relating to the proposed
transactions between Sprint Nextel Corporation (“Sprint”) and SoftBank Corp.
(“SoftBank”) and its group companies, including Starburst II, Inc. (“Starburst
II”), and the proposed acquisition by Sprint of Clearwire Corporation
(“Clearwire”). All statements, other than historical facts, including, but not
limited to: statements regarding the expected timing of the closing of the
transactions; the ability of the parties to complete the transactions
considering the various closing conditions; the expected benefits of the
transactions such as improved operations, enhanced revenues and cash flow,
growth potential, market profile and financial strength; the competitive
ability and position of SoftBank or Sprint; and any assumptions underlying any
of the foregoing, are forward-looking statements. Such statements are based
upon current plans, estimates and expectations that are subject to risks,
uncertainties and assumptions. The inclusion of such statements should not be
regarded as a representation that such plans, estimates or expectations will
be achieved. You should not place undue reliance on such statements. Important
factors that could cause actual results to differ materially from such plans,
estimates or expectations include, among others, that (1) there may be a
material adverse change of SoftBank; (2) the proposed financing may involve
unexpected costs, liabilities or delays or may not be completed on terms
acceptable to SoftBank, if at all; and (3) other factors as detailed from time
to time in Sprint’s, Starburst II’s and Clearwire’s filings with the
Securities and Exchange Commission (“SEC”), including Sprint’s and Clearwire’s
Annual Reports on Form 10-K for the year ended December 31, 2012, and other
factors that are set forth in the proxy statement/prospectus contained in
Starburst II’s Registration Statement on Form S-4, which was declared
effective by the SEC on May 1, 2013, and in other materials that will be filed
by Sprint, Starburst II and Clearwire in connection with the transactions,
which will be available on the SEC’s web site (www.sec.gov). There can be no
assurance that the transactions will be completed, or if completed, that such
transactions will close within the anticipated time period or that the
expected benefits of such transactions will be realized.
All forward-looking statements contained in this document and the documents
referenced herein are made only as of the date of the document in which they
are contained, and none of Sprint, SoftBank or Starburst II undertakes any
obligation to update any forward-looking statement to reflect events or
circumstances after the date on which the statement is made or to reflect the
occurrence of unanticipated events except as required by law. Readers are
cautioned not to place undue reliance on any of these forward-looking
SoftBank Press office
+ 81 3 6889 2300
Sard Verbinnen & Co.
Jim Barron, 1-212-687-8080
Megan Bouchier, +1-415-618-8750
Paul Kranhold, +1-415-618-8750
Press spacebar to pause and continue. Press esc to stop.