Sprint, the No. 3 U.S. mobile service provider, announced on December 17 an agreement to acquire the outstanding shares of Clearwire it doesn't already own for $2.97 per share. While Sprint holds a more than 50 percent stake in Clearwire, the deal requires approval from holders of just over 50 percent of Clearwire's minority shares.

Securing that approval is looking increasingly tenuous, however.

Investors collectively owning almost 211 million shares of Clearwire - roughly 29 percent of its minority shares - told Reuters they do not think Sprint's bid is high enough and that they would not be happy casting their votes for the deal.

Crest Financial, which owns about 8 percent of Clearwire's minority shares, immediately sued to block the deal, for example. Crest's argument, echoed by other investors, is that Clearwire is worth a lot more than $2.97 per share as it has valuable wireless spectrum that would be crucial for Sprint.

While the 29 percent alone would not be enough to vote down the deal, its underscores the growing disenchantment Clearwire's minority shareholders have with Sprint's offer. Reuters was not able to reach all Clearwire shareholders.

For the deal to go through, Sprint needs approval from investors holding more than 362 million shares out of the roughly 725.89 million total minority shares outstanding. Share figures are based on the latest publicly available information.

Sprint said in December that it had support from three strategic investors - Comcast Corp (CMCSA.O), Intel Corp (INTC.O), and Bright House Networks LLC - who collectively own about 125.4 million Clearwire shares.

Excluding the almost 211 million votes from the investors Reuters spoke to and the 125.4 million shares supporting the deal, investors with about 389.8 million outstanding Clearwire shares have not disclosed if they will approve the deal or force Sprint to revise its offer.

HIGHER DISH OFFER

Dish Network (DISH.O), controlled by mercurial billionaire Charlie Ergen, made a $3.30 per share counter-offer for Clearwire on January 8, putting further pressure on Sprint to raise its bid. Clearwire's board is reviewing the Dish bid but said that the proposed deal may not be permitted because of Clearwire's existing legal obligations to Sprint.

However, the Dish bid has convinced many of Clearwire's minority shareholders that enough discontent exists to potentially block Sprint's bid.

"Sprint can't get 50 percent of those shares. They've no way to get them," said Chris Gleason, a managing partner at Taran Asset Management, which owns about 3 million Clearwire shares.

Mount Kellett, an investment firm with about 7.3 percent of Clearwire's minority shares, said Dish's offer is proof Sprint's bid is "grossly inadequate." Mount Kellett also said it is likely to be voted down and accused Clearwire's board of breaching its fiduciary duties for accepting the bid.

Another investment manager whose firm's holdings include Clearwire shares said the Dish offer was a turning point.

"If somebody was on the fence about saying no to Sprint, they're not on the fence any more," said the investment manager who asked not to be named due to their firm's policy on media comments.

"Anybody who thinks $2.97 is a full and fair value has already exited," said the person, referring to the fact that Clearwire shares have traded well above Sprint's offer price since Dish announced its bid. Clearwire shares were up 6 percent above Sprint's offer price at $3.16 on Friday.

This person described the $2.97 offer as "dead on arrival."

Sprint, which has agreed to sell a 70 percent of its own shares to Japan's Softbank Corp (9984.T), has said that it believes its Clearwire bid is superior to Dish's offer.

Sprint argues that the Dish deal is not viable because it comes with conditions Clearwire could not accept.

While Sprint said in December that it had commitments from Intel, Comcast, and Bright House, it is worth noting that those companies have not updated their position since the Dish offer and declined to comment for this story.

(Reporting By Sinead Carew; Editing by Peter Lauria, Bernard Orr)

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