Sprint offers to buy out rest of Clearwire for $2.1B
updated 06:38 pm EST, Thu December 13, 2012
Sprint would use Softbank cash to buy rest of Clearwire
Sprint, the United States' third-largest wireless carrier, has offered to acquire Clearwire for $2.1 billion. Sprint already owns half of Clearwire, having acquired a controlling stake in the carrier in October of this year after buying $100 million worth of shares off of an investment firm. This new offer would give Sprint access a larger spectrum portfolio, an asset the carrier needs if it wants to realize its plan of taking on AT&T and Verizon for primacy in the American wireless market.
Sprint would, according to Bloomberg, be paying for remaining Clearwire shares at $2.90 per share, a 5.5 percent premium over their closing price yesterday.
Clearwire was formed as a joint venture based on $3.2 billion in investments from Google, Intel, Comcast, Time Warner Cable, and others with the goal of disrupting the telecommunications industry. That goal never materialized, though, and Clearwire is on pace to lose $1 billion for 2012.
Under the proposed plan, Sprint would provide Clearwire with $800 million in interim financing in order to keep the firm afloat. Sprint's available cash comes in large part due to Softbank's recent decision to purchase 70 percent of the American carrier for roughly $20 billion. In the announcement of that deal, reports had it that acquiring more spectrum -- a likely development of any Clearwire acquisition -- was one of Softbank's main goals for moving forward with Sprint.
