NEW YORK ( TheDeal) -- Dish Network Corp. said Tuesday it planned to sell $2.5 billion in debt via a subsidiary, adding to its cash reserves ahead of its proposed $25.5 billion acquisition of Sprint Nextel Corp.
Englewood, Colo.-based Dish, led by chairman Charlie Ergen, said it would sell the senior notes via its Dish DBS Corp. unit, and place the net proceeds into escrow. The company said the money would be used to finance the cash consideration of its Sprint offer, adding that if the Sprint deal does not occur Dish DBS would redeem the notes.
Dish last month went public with an offer for Sprint, challenging the Overland Park, Kan.-based wireless company's existing deal to be acquired by Softbank Corp. Sprint and Softbank in October announced a $20.1 billion agreement to buy 70% of Sprint.
Softbank, of Tokyo, has argued that its offer for Sprint carries less risk because it would close sooner, and has pledged significant synergies and funding for Sprint's network investments post-deal. The company has also reportedly been lobbying banks not to help Dish raise cash for its proposed bid, and has warned that a combined Dish-Sprint would be highly levered and poorly positioned to compete against wireless titans AT&T Inc. and Verizon Wireless.Sprint last month received a waiver from Softbank that would allow it to seek more information from Dish. The waiver allows Sprint to receive confidential information from its suitor, but it is not permitted to share its nonpublic information with Dish or enter into negotiations with the company. Dish in a regulatory filing detailing the notes offering said it "has had multiple meetings and communications" with Sprint advisers and a special committee of the company's board, as well as senior members of Sprint management.
"Dish Network has provided information and documentation in response to all of their questions and is unaware of any items that remain outstanding," the company said. Written by Lou Whiteman in New York
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