Clearwire Corp. (CLWR) shareholder Crest Financial Ltd. has
proposed to provide the company with $240 million in financing, in
a continued effort to oppose its acquisition by Sprint Nextel Corp.
(S).
Crest, one of Clearwire's largest shareholders, said the
financing would provide enough capital to build out 2,000 LTE sites
as planned, and pay interest expenses for the year.
The proposed financing "would also provide Clearwire's board
with more time to consider the proposed merger with Sprint." The
financing would allow the company to continue to operate as an
independent company, and pursue sales of excess spectrum, Crest
said.
In December, Sprint offered to buy the portion of Clearwire that
it doesn't already own in a $2.2 billion deal, and provided the
wireless broadband operator up to $800 million in financing that it
could draw on in installments of $80 million over 10 months.
Clearwire, which is struggling financially, tapped into Sprint's
financing in March and April.
"The Sprint notes are intended to leave Clearwire's minority
stockholders with the unfair choice of acquiescing to Sprint's
inadequate merger offer or suffering significant dilution at the
hands of Sprint," said Crest General Counsel David Schumacher.
A representative from Sprint couldn't immediately be reached for
comment.
Crest has sued to block the deal--as well as Softbank Corp.'s
(9984.TO) acquisition of 70% of Sprint--claiming Sprint was
"coercive" and used its muscle as the largest shareholder to secure
a cheap price in the deal. Crest also has petitioned the Federal
Communications Commission in an effort to stop both deals.
Sprint has called the lawsuit "baseless and without merit."
Clearwire shares were up a penny at $3.26 in recent trading, and
are up 13% so far this year. Sprint shares were down 1% to $6.17,
and are up 8.8% since the start of the year.
Write to Kristin Jones at kristin.jones@dowjones.com
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