Dish Network bids $25.5b for Sprint Nextel

NEW YORK — Smartphones, tablets, and computers all pull data from the Internet, but people still pay two different bills: the high-speed connection they get at home, and the wireless connection they get outside. Dish Network, the pay-TV operator, wants to bridge that gap.

Dish Network said Monday that it had submitted a $25.5 billion bid for Sprint Nextel, the nation’s third-largest wireless carrier, after Verizon Wireless and AT&T. It says that a merger between the two companies could roll television, high-speed Internet, and cellphone services into a single package that would be faster and more affordable for consumers.

‘‘It really means that we’re going to give consumers what every consumer wants,’’ Charlie Ergen, Dish Network’s chairman, said in a phone interview. ‘‘They want broadband and video and voice in their home and want the exact same thing outside the home. And they want it to look and feel and priced outside the same as it is inside.’’


Dish Network’s bid is an effort to scupper the planned takeover of Sprint Nextel by the Japanese telecommunications company SoftBank, which agreed in October to acquire a 70 percent stake in the US cellphone operator in a complex deal worth about $20 billion.

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Under the terms of its proposed bid, Dish Network said it was offering a cash-and-stock deal worth about 13 percent more than SoftBank’s bid.

Dish Network values its offer at $7 a share, including $4.76 in cash and the remainder in its shares. The offer is 12.5 percent above Sprint Nextel’s closing share price Friday.

Ergen said a ‘‘Dish/Sprint merger will create the only company that can offer customers a convenient, fully integrated, nationwide bundle of in- and out-of-home video, broadband, and voice services.’’

Dish Network said it would be able to combine its existing broadband and TV offerings with Sprint Nextel’s cellphone operations, allowing it to better compete with rivals like Verizon that are moving into new areas in search of revenue.


The big question surrounding the communications industry is whether partnerships and mergers are good not just for businesses, but also for the customers. Opponents of mergers say they lead to fewer jobs, less competition, and higher prices. But analysts Monday said a potential Dish-Sprint merger may pose a greater challenge to AT&T and Verizon, who dominate the wireless industry and charge higher prices for their phone plans.

As the number three cellphone service provider, with 56 million subscribers nationwide, Sprint Nextel has struggled to catch up with larger rivals. It is expected to face even more competition as the parent company of T-Mobile USA moves closer to a multibillion-dollar agreement to buy MetroPCS.

Dish Network said it would finance the cash component of the takeover through a combination of $17.3 billion in cash and debt financing.

Sprint said in a statement that it would look at Dish’s proposal, but declined to comment further on its plans.

Susan P. Crawford, a law professor at Cardoza Law School who served as special assistant to President Obama for science, technology, and innovation policy, said that there were pros and cons to a merger with Dish Networks. A combination with Dish Networks would pose more of a threat to AT&T and Verizon, which account for two-thirds of US wireless subscribers, than a partnership with SoftBank, she said.


But it would also weaken T-Mobile USA, the number four carrier that has been offering cheaper phone plans to consumers, like its latest contract-free phone plans. ‘’Right now, we have two giants and two also-rans, and now you’re getting potentially three giants dividing up the American market place, with T-Mobile lagging far behind,’’ she said.