Sprint shareholders voted today and overwhelming approved a previously announced acquisition by Japanese cellular company SoftBank, with 98 percent of shareholders supporting the deal.
The merger will not be finalized until it is approved by the Federal Communications Commission. However, both companies expect to complete the transaction by early July, and Sprint CEO Dan Hesse called the vote a "historic day" for the carrier. The U.S. Justice Department has already cleared the deal.
The news comes just one week after Dish gave up its own attempts to purchase Sprint when SoftBank offered the American carrier $21.6 billion. Once the deal is finalized, SoftBank will pay $16.6 billion to Sprint's shareholders and an additional $5 billion to the company in exchange for a 78 percent stake in the country's third largest cellular carrier. The merger will also raise Sprint's value per share up from $7.30 to $7.65.
Sprint Shareholders Overwhelmingly Approve Merger Agreement with SoftBank
OVERLAND PARK, Kan. (BUSINESS WIRE), June 25, 2013 – Sprint Nextel Corporation ("Sprint") (NYSE: S) shareholders voted today to approve and adopt the previously announced merger agreement providing for a substantial investment by SoftBank Corp. ("SoftBank") (TSE: 9984). Sprint shareholders overwhelmingly approved the deal, with approximately 98 percent of the votes cast at today's special shareholders meeting voting in favor of the merger agreement, representing approximately 80 percent of Sprint's outstanding common stock as of April 18, 2013, the record date for the special meeting.
"Today is a historic day for our company, and I want to thank our shareholders for approving this transformative merger agreement," said Sprint CEO Dan Hesse. "The transaction with SoftBank should enhance Sprint's long-term value and competitive position by creating a company with greater financial flexibility."
Consummation of the Sprint-SoftBank transaction remains subject to the receipt of the Federal Communications Commission approval. Sprint and SoftBank anticipate the merger will be consummated in early July 2013.
As previously announced, Sprint stockholders will have the option to elect to receive cash in the amount of $7.65 or one of New Sprint common stock for each share of Sprint common stock owned by them (subject to the previously disclosed proration provisions in the merger agreement). The total cash consideration available to Sprint stockholders is $16.64 billion. Pro forma for the transaction, the current Sprint stockholders' resulting equity ownership in a stronger, more competitive New Sprint will be 22 percent while SoftBank will own approximately 78 percent. Sprint and SoftBank have previously mailed to Sprint shareholders forms of election and related instructions and established 5:00 p.m., New York time, on July 5, 2013 as the election deadline, subject to extension.