May 16 (Bloomberg) -- Sprint Corp. got a credit line of as much as $1.3 billion backed by the mobile-phone company’s accounts receivable, providing a new source of funding as the carrier spends to improve its network.
Under the agreement with Bank of Tokyo-Mitsubishi UFJ Ltd., receivables from wireless service accounts will be sold on a revolving basis for the next two years, Overland Park, Kansas-based Sprint said today in a statement.
The credit line gives Sprint more flexibility as it expands its Long Term Evolution network, which offers faster download speeds for mobile devices. Chief Financial Officer Joe Euteneuer said last month that the company was close to an agreement to securitize accounts receivable. Sprint had $2.4 billion in undrawn borrowing capacity from a credit line at the end of last quarter, he said.
Sprint shares slid 4 percent to $9.15 at 3:06 p.m. in New York. The stock had dropped 11 percent this year through yesterday.
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