Charlie Ergen has a “big mouth.”
The Dish Network chairman was blasted yesterday as a wireless “amateur” whose $25.5 billion bid for Sprint would leave the company too burdened by debt to succeed.
Masayoshi Son, the president of SoftBank Corp., the Japanese telecom giant who earlier bid $20 billion for the struggling US wireless carrier, said Ergen’s Dish posed a poor fit for Sprint — and that SoftBank’s experience in the sector would better assist in a Sprint turnaround.
“I just deliver the results, instead of big-mouthing about the future,” Son said. “Do you want to attach a satellite dish to your smartphone? It’s going to become much heavier. I don’t see any real meaningful value that [Ergen] can offer to the smartphone customers.”
Ergen, who bought up spectrum to create a new US mobile network to marry to his TV service ahead of his surprise bid for Sprint on April 15, didn’t return the personal jabs.
Dish, in a statement, said it remained confident its offer is better.
Son, who submitted his bid in October 2012, was unusually personal in his attack on the bid by Ergen’s Dish.
“It’s chaos,” is how New Street analyst Jonathan Chaplin described the current situation.
Son also pointed out how Dish is less profitable than DirecTV, criticized Ergen’s huge voting control at his satellite TV firm and then hung him out to dry for a string of “ugly” legal battles with competitors.
SoftBank is working with US investment firm Raine Group.
Dish executives are set to begin the due-diligence process in the next few days. Sprint wants Dish to make a financing commitment first before showing it the books.
Dish, meanwhile, wants to see the numbers before making a commitment, says a source close to the situation.
Chaplin noted that while he thinks SoftBank’s bid is better, “shareholders feel like they’ve got leverage and they can force Softbank to up its offer — just like they did for E-Access.”
E-Access is a Japanese telecom.
Son seemed to throw cold water on that idea.
“People ask me, ‘Will SoftBank be increasing the price for the offer?’ Why should we?” Son said. “We are already providing a better deal than the Dish proposal.”
Son valued SoftBank’s bid at $7.65 per share, while computing the Dish offer at $6.31.
Dish hasn’t yet lined up its financing. Sources say one way Dish hopes to make the deal with Sprint work is to offer its TV customers unlimited Sprint broadband access.
Sprint is set to consider the SoftBank offer at a shareholder meeting on June 12.
Dish is not without its fans. John Paulson and Omega Advisors, Sprint shareholders, said they prefer Ergen’s bid.
Sprint closed at $7.05, down 1 percent.