Straight Path gets unsolicited buyout offer 'superior' to AT&T bid
AT&T was set to acquire Straight Path -- and its valuable portfolio of mmWave spectrum -- in a deal valued at $1.6 billion, but Straight Path announced Tuesday that it has received a "Superior Proposal" from another multi-national telecommunications company.
The new bidder made an "unsolicited offer" to acquire all issued and outstanding shares of Straight Path for $104.64 a share, in an all-stock transaction valued at $1.8 billion. Under the AT&T deal, Straight Path shareholders would receive $95.63 per share.
Straight Path does not name the "Bidder," though Reuters reported earlier that Verizon had considered making a bid for the company. Straight Path's extensive, nationwide portfolio of 39GHz and 28GHz wireless spectrum licenses would help a firm like AT&T or Verizon roll out 5G networks.
The Straight Path board has yet to change its recommendation to support the AT&T deal. However, the company has notified AT&T of the new offer. AT&T has five business days to reach a new agreement with Straight Path to match or exceed the new offer.
"Straight Path is not permitted to enter into the Bidder's merger agreement or to change its recommendation in favor of the AT&T transaction unless, at the end of the Negotiation Period, the Straight Path Board determines that the Bidder's offer continues to constitute a 'Superior Proposal' and satisfies certain other requirements under the AT&T Merger Agreement," Straight Path said in its release.
In a statement, AT&T acknowledged that it has five days to negotiate. "We will evaluate the situation and make a decision in that time frame," the company said.
The bidder has left its offer on the table until the end of May 3.
If Straight Path terminates its deal with AT&T to take the other offer, it will be required to pay AT&T $38 million. The new bidder, however, has offered to pay the fee on Straight Path's behalf.
Your original iPhone won't work on AT&T's network anymore