Sprint this week confirmed that it has reached a deal to secure a majority stake in Clearwire.
In a filing with the Securities and Exchange Commission, Sprint said the arrangement will give it control of 50.8 percent of Clearwire. Previously, Sprint had a 48.1 percent stake in Clearwire, but will purchase assets held by Eagle River Holdings and its CEO Craig McCraw for $100 million.
A Clearwire spokesman said in an email that the company is not commenting on the transaction. Sprint did not immediately respond to a request for comment.
Last year, Sprint reduced its voting shares in Clearwire from 54 percent to less than 50 percent in order to shield itself from possible Clearwire destruction. In June, Sprint reclaimed those voting shares, gaining more control with fewer consequences.
When Softbank agreed to acquire a 70 percent stake in Sprint recently, however, the Japanese company reportedly wanted Sprint to purchase Clearwire as part of the deal. According to PCMag Lead Mobile Analyst, Sascha Segan, Softbank could buy out the remaining percent of Clearwire shares, and speed up Sprint’s LTE network as well as Clearwire’s urban TD-LTE rollout.
“If someone can actually make Clearwire’s network function next year, it will be considerably faster than any competitor,” Segan said.
Clearwire merged its WiMAX network with Sprint in 2008, providing a faster alternative to the 3G offerings of other carriers. But the service’s slow, spotty rollout fell behind T-Mobile and Verizon Wireless on 4G. Last year, Sprint CEO Dan Hesse announced that the company signed a nonbinding cooperation agreement with Clearwire to “work together on the technical specifications of the Clearwire LTE network.” The mobile company essentially propped up Clearwire with a series of investments, paying Clearwire up to $1.6 billion in December for access to its WiMAX service, through at least 2015.
In January, Sprint said it would launch its 4G LTE network in 10 cities by mid-year, including Dallas, Atlanta, Houston, and San Antonio – with WiMAX as a bridge to LTE services. Sprint’s 4G LTE network debuted on July 15 in 15 cities around the nation. By the end of 2013, the company expects to have completed most of its build out of its new 4G and 3G nationwide networks. Sprint in certainly making a lot of moves to make sure it capitalizes on the SoftBank deal.
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