Bloomberg News

Clearwire Draws $80 Million From Sprint Ahead of Merger Vote (1)

April 29, 2013

Clearwire Corp. (CLWR:US) said it will draw $80 million in financing from Sprint (S:US) Nextel Corp. for a third straight month, leaning on its majority owner for funding as it awaits a shareholder vote on Sprint’s takeover proposal.

The financing, part of a prearranged agreement with Overland Park, Kansas-based Sprint, can be exchanged for Clearwire stock at $1.50 a share under certain conditions. Bellevue, Washington-based Clearwire, which has struggled to profit from its wireless Internet service, still has $400 million of financing available from Sprint, it said in a filing late on April 26.

The move gives Sprint a way to tighten its grip on Clearwire as a rival suitor, Dish Network Corp. (DISH:US) seeks to wrest control of the wireless Internet company’s valuable airwaves -- perhaps by acquiring Sprint itself. Dish, the Englewood, Colorado-based satellite-TV company, has offered $25 billion for control of Sprint and $3.30 a share for Clearwire stock, more than Sprint’s $2.97-a-share offer.

Clearwire shareholders are scheduled to vote on Sprint’s offer May 21. Sprint is also considering a $20 billion takeover proposal from Tokyo-based SoftBank Corp. (9984), with a tentative date of June 12 for a shareholder vote on that transaction. Sprint’s board has a special committee reviewing the Dish bid.

The Wall Street Journal reported the Clearwire funding decision earlier today.

Clearwire was unchanged at $3.44 at the close in New York. Sprint was unchanged at $7.12, and Dish gained 1.4 percent to $40.56.

To contact the reporter on this story: Crayton Harrison in New York at tharrison5@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net


Cash Is for Losers
LIMITED-TIME OFFER SUBSCRIBE NOW

Companies Mentioned

  • S
    (Sprint Corp)
    • $4.96 USD
    • 0.13
    • 2.62%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus