It was reported that the nation’s third-largest telco Sprint Nextel is looking to buy a controlling stake in Clearwire without an acquisition. Sure enough, Sprint instead opted to buy out one of Clearwire’s other shareholders to increase its 48 percent stake to a controlling 50.8 percent stake. The terms of the deal were not disclosed, but Sprint acknowledged as much in a filing with the U.S. Securities and Exchange Commission on Thursday…
Reuters first broke the news:
Wireless carrier Sprint Nextel Corp has acquired control of Clearwire Corp after buying out one of the company’s other shareholders, Sprint said in a securities filing on Thursday.
Sprint reached the deal with Eagle River Holdings on Wednesday and now controls a 50.8 percent stake in Clearwire, the filing said.
The filing confirms that Sprint has bought the outstanding shares of Eagle River Holdings, which represents the investment arm of Clearwire’s original founder Craig McCaw. Specifically, the carrier has opted to buy 31 million Class A shares and about 2.7 million Class B shares from Eagle River Holdings.
The Wall Street Journal previously reported that Sprint was in talks with Clearwire investors, including Craig McCaw’s Eagle River Holdings LLC and Comcast Corp.
The transaction should allow Sprint to take control of Clearwire’s board so it could appoint a majority of directors and control the company, thus helping mitigate risks associated with having its own customers on Clearwire’s network.
Besides, Sprint will sooner than later need access to Clearwire’s wireless spectrum. The carrier is said to be consolidating more than 100MHz of 2.5GHz spectrum that Clearwire has.
Sprint wrote in another filing, responding to possible ramifications regarding its new owner, Japan’s Softbank:
Clearwire, Sprint obviously enjoys a very good relationship with Clearwire and we are a significant investor.
But there are no elements in this agreement between SoftBank and Sprint that require either party, SoftBank or Sprint, to enter into any new agreements with Clearwire or with anyone else.
Sprint also announced today it has added Research In Motion’s BlackBerry Mobile Fusion software to its Mobile Device Management Suite for business.
What do you think of Sprint’s deal with both Softbank and Clearwire?
Will it help consolidate its spectrum and help with that 4G LTE roll-out?