Dish Network Corp. lined up Jefferies Group LLC to help it finance its $25.5 billion bid for Sprint Nextel Corp. as it tries to convince the company its offer is better than SoftBank Corp.’s, people with knowledge of the matter said.
Dish added Jefferies in an effort to win over Sprint’s board, which has so far held off on granting Dish access to its books amid concerns about funding, said the people, who asked not to be identified because the process is private. Sprint’s board also is concerned about the debt that would be placed on the merged company, and has doubts about Dish’s estimate of $11 billion in cost savings, people familiar with the situation said this week.
Adding a second bank may help Dish make its case that its offer is likely to be superior to SoftBank’s $20.1 billion bid for a majority stake in Sprint. Jefferies and Barclays Plc, which is advising Dish and has provided a letter saying it’s confident it can help raise the necessary financing, will seek out one or two more banks to be part of an estimated $9.3 billion package, the people said.
Richard Khaleel, a spokesman for Jefferies, declined to comment on whether or not the bank is involved with Dish’s financing. A spokesman for Dish declined to comment. Scott Sloat, a spokesman for Sprint, declined to comment on Dish’s financing.
Dish Chairman Charlie Ergen, who’s challenging SoftBank for control of the third-largest U.S. wireless carrier to bolster his pay-TV empire with mobile capability, has said he’ll provide committed financing if Sprint makes it clear that it will engage with him once the financing has been secured.
“When they look us in the eye and say, ‘We will give you access to the books because we believe you potentially will lead to a superior offer and that the only thing left - and the only thing that’s left is your committed financing,’ then we’ll give them the committed financing,” he said yesterday on a conference call.
Dish previously told Sprint it wouldn’t provide committed financing until it gains access to the financial information, people familiar with the matter said last week.
Sprint shares were little changed at $7.36 at the close in New York today. They have climbed 30 percent this year, putting them above the price offered by SoftBank or Dish, suggesting that investors are expecting a bidding war.