Dish could challenge cable's quadruple play with Sprint merger

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Dish Network (Nasdaq: DISH) submitted a $25.5 billion offer to acquire Sprint Nextel Corp. (NYSE: S)--a deal that could help it compete with the quadruple-play bundles marketed by Comcast (Nasdaq: CMCSA), Time Warner Cable (NYSE: TWC), Verizon (NYSE: VZ) and other pay TV rivals.

The offer comes five years after Comcast, Time Warner Cable, Bright House Networks and Cox Communications abandoned a joint venture with Sprint called Pivot, which was focused on marketing quad-plays of cable and wireless services. The cable MSOs teamed up in late 2011 with Sprint rival Verizon Wireless on a joint marketing partnership.

Dish is offering $17.3 billion in cash and $8.2 billion in stock to Sprint shareholders, topping the $20.1 billion that Softbank offered to acquire a 70 percent stake in Sprint last year. CEO Charlie Ergen said in a letter to Sprint shareholders that his offer is superior.

"There really is no one company on a national scale that puts it all together," Ergen said on a conference call with analysts and reporters Monday. "The new Dish/Sprint company will do that."

Ergen has said in recent months that Dish may look to partner with a mobile carrier to commercialize the broadband wireless spectrum that it acquired from TerreStar and DBSD North America. When Dish submitted a $3.3 billion offer to buy wireless broadband provider Clearwire (Nasdaq: CLWR) in January, some Wall Street analysts suggested the move was aimed at forging a partnership with Clearwire investor Sprint, which had also bid to acquire the company.

Dish investors responded negatively to the offer on Monday. Shares in Dish were trading at $35.35 at 9:56 a.m. ET, down $2.30, or 6.05 percent.

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