In the news:
Late-entry Sprint bid fits style of brash Dish exec
Dish Network co-founder Charles Ergen is a tough-minded mogul unafraid to make big bets like last week’s $25.5 billion offer for Sprint.
The Kansas City Star
Ergen in charge
History: Charles Ergen founded Dish Network in 1980 with his wife, Cantey Ergen, and James DeFranco.
Control: He owns 52 percent of Dish stock — 231 million shares worth about $8.7 billion —and holds 88 percent of the voting power. Family trusts own another 4 percent.
Compensation: Total 2012 compensation was $1.3 million, including $900,000 in base salary.
Source: Company reports
Who is Charles Ergen, the 37th-richest man in America and self-described “country boy from Tennessee” who wants to snag Sprint Nextel?
For one thing, he’s a corporate mogul with a different style from Masayoshi Son, the second-richest man in Japan, who also has a deal with Sprint.
Ergen, 60, is a former door-to-door satellite-dish salesman who now oversees Dish Network from its headquarters in Englewood, outside Denver. He lived up to his swashbuckling reputation last week, mounting a $25.5 billion late-entry challenge to the long-standing offer for Sprint by Son’s SoftBank.
Analysts and writers in the business media who have dealt with Ergen describe him as a poker-playing dealmaker, fearless about proposing megadeals, unafraid to pursue litigation to settle disputes and head of “the meanest company in America.”
The “mean” title topped a Bloomberg Businessweek article in January about Ergen, who’s worth an estimated $10.6 billion as the founder and chairman of the Dish satellite TV service.
Ergen, speaking at a February digital-media conference, said “mean” was a bit unfair. Rather, he said, he and the Dish company are “demanding.”
The article cited employee complaints about long hours and a “poisonous” environment and blamed Ergen, known for publicly yelling at employees. The “mean” label came partly from tabulating posts on Glassdoor.com, an online site where employees can comment about their companies.
One example of his hard-driving style: When snow threatened the Denver area, Ergen reportedly suggested in a staff meeting that employees should book nearby hotel rooms (at their own expense) so they wouldn’t be late driving to work.For his part, Ergen said, “We work hard. …We want you to take personal responsibility. … If you don’t think you can make a difference, we’re not a good place for you.”
Showing occasional flashes of wit, he said he does care about his employees, “but that doesn’t mean I give them everything they want.” Rather, he said, he provides an environment that “helps them reach their potential.”
Still, Ergen doesn’t seem to have a huge fan club. Institutional investors also complain that Ergen seems to go out of his way to be uncooperative.
“They’re probably the least transparent company of any I’ve ever dealt with,” Chris Marangi, a portfolio manager at Gamco Investors, told Businessweek.
But Ergen was pretty transparent about his intent in connection with the Sprint bid:
“Sprint is in play,” he told the Dow Jones News Service in New York. “We think we’ve made an offer that’s much more compelling than the SoftBank transaction.”
Ergen’s playing his top card yet to move Dish from being just a pay-TV alternative to being a player in the wireless industry. Getting control of Sprint’s spectrum is a logical step after Dish last year got regulatory approval to provide mobile phone service. Dish needs a cellphone network to make that happen.
The goal is to offer video, high-speed Internet and voice service in one package that people could use with their mobile devices. Dish took a tentative step toward that earlier this year with an informal offer to buy Kirkland-based Clearwire, a wireless carrier that’s half-owned by Sprint.
And whatever one thinks of Ergen or his management style, he’s built a solid business record.Ergen in 1980 co-founded EchoStar Communications, a satellite-services provider. EchoStar launched Dish Network in 1996, competing with DirecTV. The renamed Dish spun off from EchoStar in 2008.
In April 2011, Dish bought bankrupt retailer Blockbuster for $320 million. It then bought $3 billion in broadband spectrum.
The Sprint foray isn’t Ergen’s first megadeal. He tried in 2002 to buy DirecTV owner Hughes Electronics. That attempt was blocked by regulators, but EchoStar eventually bought Hughes in 2011, though Dish and DirecTV were no longer involved in that deal.
Son, 55, the multibillionaire founder of SoftBank, loses no ground to Ergen in terms of ambition and entrepreneurial talent, but he’s amassing his business empire in a far more publicly visible way than Ergen.
While building a personal fortune estimated at more than $9.1 billion, Son has bought controlling interest in an international lineup of technology companies. He is said to be the most-followed business celebrity on Twitter in Japan.
Son is variously described as charismatic, a shrewd negotiator, articulate and outspoken.
Against entrenched competition, Son made dramatic inroads into the cellphone industry in tech-loving Japan — at an impressive rate.
Now he wants to use his company’s money to shake up the wireless status quo in the United States, hoping to transform Sprint, the No. 3 wireless company, into a stronger competitor to Verizon and AT&T.
“It’s not an easy path to go,” Son said at a Tokyo news conference last fall announcing the Sprint offer. “But without taking on a challenge, we may end up facing bigger risks.”