DISH Network Corp (NASDAQ:DISH) may dish-out $25.5 billion for Sprint (NYSE:S)

The satellite TV company owned by Charlie Ergen, DISH Network Corp (NASDAQ:DISH) (Closed: $36.77, Down by: 2.29%) has offered to buy-out Sprint Nextel Corporation (NYSE:S) (Closed: $7.06, Up by 13.50%) for $25.5 billion. This, in a definite bid to challenge the bid put forth by Softbank Corp (TYO: 9984) (closed: 4345.00 JPY, Down by 7.26%). In a statement, the Englewood, Colorado-based Dish said that Sprint’s shareholders would get $7 per share which will include $4.76 in cash as well as a stock that represents close to 32 percent of the joint company.

Market-entry point
This indicates that the cash value of the offer is $17.3 billion and the stock value is $8.2 billion. Sprint which is the third largest wireless carrier in the United States had received a $20 billion buy-out offer from Softbank. Via this offer, Softbank would have gained control of 70 percent stake in the company. Dish is primarily a satellite company and does not have any mobile-customers of its own. With this deal it is hoping to gain an entry into the competitive and highly lucrative wireless business. The company already owns the necessary spectrum.

There has been a large amount of consolidation-targeted activity in the wireless industry lately. Smaller carriers have been on the lookout to merge with other companies in a bid to put up a stronger offense to the giants of the industry, Verizon Communications Inc and AT&T. As competition heats up in the wireless industry deals of this magnitude are bound to surface and create ripples in the market.