Straight Path Board Determines Rival Bid Superior to AT&T's
The apparent fight between AT&T and Verizon over Straight Path and its high-frequency spectrum is heating up. Straight Path last week said it received a superior offer of $1.8 billion, compared with AT&T’s $1.6 billion bid (see 1704260041). Wednesday, Straight Path said its board reviewed the unsolicited counteroffer and found it to be “superior.”
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Straight Path isn’t saying who made the rival offer, though analysts said last week it appeared to be Verizon. Verizon didn’t comment. AT&T declined to comment. AT&T officials said April 25 during an analyst call they would evaluate the situation and decide how to proceed (see 1704250067).
“Straight Path has notified AT&T of the Straight Path Board's determination and, pursuant to the AT&T Merger Agreement, AT&T has the option for the next three (3) business days to negotiate a possible amendment of that agreement to match or exceed the Bidder's offer,” Straight Path said in a news release Wednesday. “Straight Path is required, and intends to, negotiate in good faith with AT&T during the Negotiation Period.” Straight Path conceded under the terms of the agreement, it will have to pay AT&T a $38 million termination fee if it accepts the counteroffer.
The major carriers have been pursuing high-frequency spectrum as part of the move to 5G. T-Mobile said this week it has 200 MHz of spectrum in the 28/39 GHz bands, which it will use for 5G (see 1705020063).
Straight Path’s stock price soared 23 percent Wednesday to close at $155.20. In February, it traded at less than $33.