Dish reportedly makes $2 billion offer for LightSquared's spectrumAlex Wagner - Editorial Director of News and Content
Dish Network has been pretty busy lately in its quest to enter the wireless business, and according to a new report, the company is now targeting LightSquared as a way to bolster its existing spectrum holdings. Source speaking to Bloomberg claim that Dish chairman Charlie Ergen recently offered to buy LightSquared's spectrum for $2 billion. The offer was reportedly made on May 15, and LightSquared's is said to have until May 31 to make a decision. Neither company has officially commented on the rumors, but the tipsters claim that LightSquared would use the funds to pay off its secured debt.
LightSquared previously tried to build out its own 4G LTE wireless network, but the FCC shot down its plans to do so over concerns that its spectrum could interfere with GPS systems. Things went downhill from there, with Sprint axing its spectrum hosting agreement with LightSquared, followed by the company's decision to file for bankruptcy. LightSquared submitted new network plans with the FCC toward the end of 2012, but the federal agency has yet to approve that spectrum for use in a wireless network.
Meanwhile, Dish's spectrum has already been greenlit by the FCC for use in a wireless network, and since then the company has been trying to find a partner to help it break into the wireless industry. The company has already made offers for Clearwire and Sprint, and now Dish apparently sees LightSquared as a good way to help it bolster its existing spectrum. Considering how desperate Dish has been to get into the wireless business, it's no surprise to see that it's now gunning for LightSquared's spectrum, especially after the issues that LightSquared has been having getting approval for its own network.
We'll have to wait until May 31 to see how this matter plays out, but it'll be interesting to see if Dish can snag LightSquared's spectrum and how that could influence Dish's potential deal with Sprint. It's also worth noting that Bloomberg's sources claim that Dish's offer is a "stalking-horse agreement," which means that other company's could come in with a higher bid for LightSquared's spectrum. The next 11 days could be quite a bit more exciting than we'd previously anticipated, so stay tuned and we'll update you with more details as we get 'em.