Clearwire Plans to Sell up to $345M in Stock Following Deal with Sprint

12/5/11Follow @curtwoodward

Remember when Sprint (NYSE: S) said it would buy more stock if Clearwire made an offering sometime in the future? Well, the bill’s about to come due: Clearwire (NASDAQ: CLWR) says it plans to sell $300 million in Class A common shares. The sale’s underwriters also will get a 30-day option to buy up to $45 million more in Class A shares.

Kirkland, WA-based Clearwire said the stock sale will help finance its planned construction of a fourth-generation (or 4G) network based on technology known as long-term evolution, or LTE. Clearwire’s existing network is based around a different kind of technology, known as WiMAX, which is being passed by as LTE becomes standard in the industry.

Clearwire has previously announced plans to build an LTE network along its WiMAX offering, but needed about $600 million to pay for the project. Majority shareholder Sprint cut a financing deal with Clearwire last week to provide up to $1.6 billion, allowing Clearwire to make a debt payment that it had considered skipping.

That lifeline from Sprint included a commitment for Sprint to purchase stock based on its existing 49.6 percent voting interest in Clearwire. Sprint will be buying Class B common shares, Clearwire said in Monday’s announcement. The previously announced deal with Sprint also included a pre-payment of up to $350 over two years for capacity on Clearwire’s LTE network, if Clearwire hits milestones for building the network by June 2013.

J.P. Morgan, BofA Merrill Lynch, and Jefferies & Company will be the joint book-running managers, Clearwire said.

Curt Woodward is a senior editor for Xconomy based in Boston. Email: cwoodward@xconomy.com Follow @curtwoodward

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