Clearwire Draws $80 Million From Sprint Ahead of Merger VoteCrayton Harrison
Clearwire Corp. said it will draw $80 million in financing from Sprint 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. 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., 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.