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Sprint Corp. said Friday it would get a $1.1 billion cash infusion by striking a deal to sell certain devices leased to its customers to a newly formed entity that would then rent them back to Sprint.

The transaction essentially acts as a loan to the telecommunication company that comes at a cheaper cost than tapping debt markets, Sprint said.

Shares fell 1.5% in premarket trading.

The cash proceeds are part of about $1.2 billion in total consideration slated to be exchanged for about $1.3 billion of leased device assets.

In the wake of the deal, Sprint also revised its annual outlook for adjusted earnings before interest, depreciation, taxes and amortization to a range between $6.8 billion and $7.1 billion, down from a previous forecast of $7.2 billion to $7.6 billion.

The transaction is expected to close in the first week of December and would "immediately improve the company's liquidity position" at a cheaper cost than bond markets, Sprint said in a release announcing the move.

The deal also sets in place a mechanism that Sprint said helped soften the capital impacts linked to leasing out devices to its customers, improving its balance sheet.

"Providing mobile devices to customers is the biggest use of cash in the carrier model and with this new structure we have more closely aligned Sprint's cash flows with those associated with leasing devices to our customers," said Tarek Robbiati, Sprint's financial chief.

Mobile Leasing Solutions LLC, the new entity, was formed by a group of equity investors including SoftBank, and has secured debt financing from several lenders, including international banks and leasing companies.

Write to Ezequiel Minaya at ezequiel.minaya@wsj.com

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(END) Dow Jones Newswires

November 20, 2015 09:35 ET (14:35 GMT)

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