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You are here: MacNN Forums > News > Tech News > Sprint makes it official: will buy Clearwire for $2.2B

Sprint makes it official: will buy Clearwire for $2.2B
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MacNN Staff
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Dec 17, 2012, 04:54 AM
 
Confirming earlier reports of an acquisition in the offing, Sprint today announced that it would be taking full ownership of wireless broadband wholesaler Clearwire. The final price for the deal came in at $2.2 billion, just above earlier estimates that had Sprint paying $2.1 billion. That price represents a 128 percent premium to Clearwire's closing share price from October 10, the day before Sprint and Softbank's discussions were confirmed in the marketplace.

Part of Softbank's rationale for buying a controlling share of Sprint was that it could use Sprint's standing in the market as a base for expansion. Indeed, the purchasing of more spectrum to bolster Sprint's current holdings was a main point of emphasis in talks surrounding the buy. The 2.5GHz spectrum assets Clearwire holds will prove complementary to Sprint's own current holdings, and executives at the nation's third-largest carrier view the acquisition as essential to improving Sprint's ability to compete against Verizon and AT&T. The deal will see Sprint providing up to $800 million in financing for Clearwire in the form of exchangeable notes. Those notes will be exchangeable under certain circumstances for Clearwire common stock at $1.50 per share. Sprint will purchase $80 million of exchangeable notes per month for up to 10 months beginning in January of 2013. The deal is still subject to approval from various parties. It will require the approval of a majority of Clearwire's stockholders not affiliated with Sprint or Softbank. The deal is also contingent upon the completion of Softbank's acquisition of Sprint.
     
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Dec 17, 2012, 05:49 AM
 
PT Barnum was right.
     
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Dec 17, 2012, 09:24 AM
 
Originally Posted by Mr. Strat View Post
PT Barnum was right.
Barnum is widely, but erroneously, credited with coining the phrase "There's a sucker born every minute."
     
   
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