Sprint-Clearwire WiMAX deal clears final hurdle
Kansas City Business Journal
Clearwire Corp. said Thursday that its shareholders have approved the company’s planned combination with Sprint Nextel Corp.’s WiMAX business.
The investment in the deal by Overland Park-based Sprint Nextel (NYSE: S) is valued at $7.4 billion; the investment by Clearwire (Nasdaq: CLWR), based in Kirkland, Wash., is valued about $3.9 billion. A group of investors putting in $3.2 billion includes Comcast Corp. (Nasdaq: CMSCA, CMCSK), Intel Corp. (Nasdaq: INTC), Time Warner Cable Inc. (NYSE: TWC), Google Inc. (Nasdaq: GOOG) and cable provider Bright House Networks.
In a release Thursday, Clearwire said it has secured consent to the transaction from a majority of the lenders under its credit agreement and expects to have an amended credit agreement soon that will permit the transaction.
A spokesman for Clearwire said that a number of administrative steps remain to close the deal, which the company expects to occur by year’s end.
“Today, our shareholders have taken a transformative step toward enabling an entirely new mobile Internet experience for consumers and businesses across the country,” Clearwire CEO Benjamin Wolff said in the release. “With an unmatched spectrum portfolio, a next generation all IP network, an ever-expanding ecosystem of mobile 4G devices, and the backing of some of the most innovative communications, entertainment and technology companies in the world, Clearwire is ready to redefine mobile Internet services in the U.S.”
Clearwire shares closed on Thursday at $3.89, down nearly 33 percent, or $1.91, on volume of 2 million shares, according to Yahoo Finance. The stock’s average daily volume for the past three months is 700,648 shares. Sprint shares closed on Thursday at $1.37, down 27 percent, or 51 cents, on volume of 67.3 million shares. The stock’s average daily volume for the past three months is 38.7 million shares.
On Monday, an Illinois circuit court said that Sprint wireless affiliate iPCS Inc. must withdraw its motion for a temporary restraining order on the deal, though reserving its right to refile, according to documents iPCS (Nasdaq: IPCS) filed with the Securities and Exchange Commission. Based in Schaumburg, Ill., iPCS, Sprint’s largest independent wireless affiliate, filed the emergency motion on Nov. 3. It alleges that the Sprint-Clearwire deal would violate affiliation agreements by creating competition for iPCS subsidiaries, which resell Sprint products and services.
On Nov. 4, the Federal Communications Commission approved the deal.
Sprint ranks No. 1 on the Kansas City Business Journal’s list of area public companies.
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