Mount Kellett Capital Management LP
("Mount Kellett") today sent a letter to the Clearwire Corporation CLWR ("Clearwire") Board of Directors outlining issues related to, among
other things, Clearwire's relationship with Sprint Nextel Corporation S. Full text of the letter follows:
January 16, 2013
BY EMAIL & FEDEX
Clearwire Corporation
1475 120th Avenue NE
Bellevue, WA 98005
Attn: Special Committee of the Board of Directors
Dear Ladies and Gentlemen:
As you know from our previous correspondence, Mount Kellett Capital Management
LP ("Mount Kellett" or "we") is a multi-strategy private investment firm
focused on global value, special situations and opportunistic investing.
Mount Kellett and funds and accounts under common control collectively have
beneficial ownership in Clearwire Corporation ("Clearwire" or the "Company")
of 53.2 million shares, or approximately 3.6%, of the Company's outstanding
voting stock (the "Shares"), or approximately 7.3% of the Company' outstanding
voting stock not controlled by SprintNextel Corp ("Sprint").
We have of course been carefully monitoring recent developments concerning
Clearwire and its proposed acquisition by Sprint, including the Company's
announcement on January 8, 2013 that it had received an unsolicited proposal
from DISH to acquire Clearwire at a premium to the consideration offered by
Sprint, to acquire certain of Clearwire's excess spectrum and to provide
financing to Clearwire.
The DISH proposal is further evidence of what has been clear to us for many
weeks:
1. The Special Committee, in breach of its fiduciary duties to the minority
stockholders of Clearwire, utterly capitulated to Sprint's demand to sell
the Company at a grossly inadequate price.
2. The Special Committee and the Board of Directors generally, in breach of
their fiduciary duties and despite public assurances to the contrary,
failed to conduct a vigorous process for the monetization of the Company's
excess spectrum.
3. The Special Committee and the Board of Directors generally, in breach of
their fiduciary duties, failed to adequately explore other financing
alternatives available to the Company, instead accepting a highly coercive
and highly dilutive convertible debt financing from Sprint.
Instead of doing its job, the Special Committee opted for a quick sale to
Sprint on the cheap. The result has been massive shareholder dissatisfaction,
litigation by a substantial shareholder against the transaction, and the
likelihood—perhaps now a certainty—that the Sprint acquisition of Clearwire
will be voted down.
In light of these circumstances, it is incumbent on the Special Committee to
take its time to thoroughly and thoughtfully evaluate the DISH proposal,
including how to address certain obstacles to consummating the proposal
asserted by Sprint (such as through a potential reorganization process) and to
negotiate for all possible improvements to the proposal. The Special Committee
should refrain from compounding the harm to minority stockholders that results
from its previous mistakes and avoid taking any hasty actions that would
jeopardize the opportunity of minority stockholders to realize substantially
higher value for their Shares or that would permit a transaction between
Sprint and DISH that does not result in a substantial improvement in the
consideration to be paid to minority stockholders by Sprint.
We are available, as always, to discuss issues relevant to Clearwire at your
convenience.
Very truly yours,
MOUNT KELLETT CAPITAL MANAGEMENT LP
Market News and Data brought to you by Benzinga APIs© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Loading...
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in