Sprint plans to skip upcoming spectrum auction

Reuters News
Posted: Nov 13, 2013 10:48 AM
Sprint plans to skip upcoming spectrum auction

(Reuters) - Sprint Corp said on Wednesday it would not take part in an upcoming government auction of so-called H-Block airwaves, potentially leaving the field clear for Dish Network Corp to buy the spectrum.

Sprint announced the decision a day after No. 4 U.S. mobile provider T-Mobile US Inc, said it too had decided against participating in the auction, which is slated to take place in January.

While Sprint already bought a huge amount of spectrum in July through its takeover of Clearwire Corp, analysts had still expected Sprint to bid for the H-Block spectrum because it is adjacent to other Sprint spectrum holdings. The U.S. government had set a November 15 deadline for applications for the auction.

Shares in satellite TV provider Dish rose 1.6 percent to $51.19 on Nasdaq after the news. Its shares had traded above $50 for the first time since 2000 on Tuesday after its earnings report.

BTIG analyst Walter Piecyk said Sprint's decision was good news for Dish because it may not face any rival bidders. He does not expect AT&T Inc or Verizon Wireless to bid for the spectrum. AT&T declined to comment.

Verizon representatives did not respond to several requests for comment.

Dish has already told the Federal Communications Commission that it would bid a base price of about $1.5 billion in the auction if the FCC grants it waivers of conditions related to its existing spectrum licenses.

If Dish wins the spectrum without having to pay any more than the reserve price, Piecyk said ift implies a price that is half that of recent transactions in the industry.

Dish investors have been waiting for almost a year for the company to decide how it will use its existing wireless airwaves. One of its options could be to forge a network partnership with a rival such as Sprint or T-Mobile US.

(Reporting by Sinead Carew; Editing by Gerald E. McCormick)