Sprint buyout is one wacky deal

I've never seen anything like it, and it makes me want to sell some shares.

By Jim Cramer Oct 15, 2012 9:06AM

TheStreet.com logoJacqueline Veissid, Photodisc, Getty ImagesNow I remember why I like the stock market so much -- because sometimes companies do really stupid things and you can make a lot of money from their inanities.

 

That's how I felt after listening to the weird, out-of-body "Softbank to buy Sprint (S)" press conference Monday morning. The whole exercise reminded me of those old Godzilla vs. Mothra movies. This time, Earth's cellphone markets are at stake!

 

Let's just tick down how strange this whole thing has been.

 

1. We have heard absolutely nothing from the always-candid Dan Hesse, the chief executive of Sprint Nextel and one of my favorite CEOs. He has not bothered to respond to my many reach-outs, other than to say, through his people, that he's not talking. Maybe that will change now, because Hesse did say at the press conference that he wouldn't necessarily buy Clearwire (CLWR). He said he would use the new money for something -- maybe to pay down debt, maybe to expand. Who knows?

2. Softbank is being incredibly defensive about the whole thing, having spent most of the out-of-body press conference talking about how it isn't overpaying. If I could subtext it, I would say: "I know you think we are really stupid, but now we will be the world's third-largest cellphone player. Therefore it's good, so don't worry about it."

 

3. We still aren't all that clear what the rest of Sprint is worth. We know Softbank will be buying in the open market, but how aggressively and with what kind of top? Who knows? There's lots of firepower, but will it be real? Will it just be on the bid side? Who can figure that out?

 

As for me, this wacky deal makes me want to sell some of Sprint. It's a stock that I have recommended heavily in the past. I'd let the rest run just in order to see how wild and crazy Softbank will get in what seems like an attempt to walk up a stock to see how far it can go.

 

I've never seen anything like this one. I guess all you can really do is to say, "Thank you, Masayoshi San!"

 

Jim Cramer, thestreet.com

 

Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust and has no positions in stocks mentioned.

 

 


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6Comments
Oct 15, 2012 10:54AM
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Now I understand  -  they keep gas prices high so they can say "consumer spending is up".What a scam ! ! !
Oct 15, 2012 9:55AM
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It must be so easy to be a "pundit'.......churn out some meaningless blurb everyday that is usually completely wrong ........but then I am sure cramer is much smarter than all these Japanese businessmen after all he took his own company the street dot com from the 60s all the way down to $1 or so a share......
Oct 15, 2012 1:08PM
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I don't think it's whacky at all. When you make your money pumping airtime in an economy that is questioning why it pays 50 times more now than it did 15 years ago... you sell your white elephant and hope to buy something with a whackier racket. As long as a portion of the sale proceeds end up in your offshore bank account... just GO baby. That's a class they teach you at Harvard, isn't it? Shifty Unethical Practices 101.
Oct 15, 2012 1:28PM
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you can put a harvard label on a cheap suit but its still a cheap suit
Oct 15, 2012 11:42AM
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the genius of cramer is not his stock picks..........it is how he remains on the air with his obvious pump and dump scam.........most people would be in jail by now yet MSN and CNBC keep giving him

a forum for his scam

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