Furthermore, Clearwire and Sprint have worked out a brilliant plan to make sure that Dish doesn't run away with the spoon wireless network provider. The nation's third largest carrier is lending Clearwire $800 million to be drawn down in $80 million notes. The beauty of the deal is that these notes are convertible into Clearwire stock at $1.50, less than half of the current price for the stock. This dilutes any holdings in Clearwire that Dish might own, and makes purchasing the company more expensive for Dish CEO Charles Ergen and his firm. So far, Clearwire has drawn down $160 million.
Ergen still might get the last laugh though. Assuming that stockholders go along with the recommendation from ISS and vote in favor of the Sprint acquisition, Clearwire would be totally owned by Sprint. But Dish Network is offering $25.5 billion to purchase Sprint which would include Clearwire once that deal closes. Japan's Softbank also has a bid on the table for Sprint, with a $20.1 billion offer to buy 70% of the company. Dish is seeking as much spectrum as it can afford in the hopes of starting up a new nationwide carrier.