Clearwire finally shores up its financing
The company raised $734 million in the latest stock offering, which includes a healthy contribution from majority shareholder Sprint Nextel.
Clearwire shareholders and customers can breathe a sigh of relief now.
The wholesale 4G network provider said today it raised $734 million in its latest stock offering, shoring up its cash position just as it was facing potential issues meeting its financial obligations. The funds include $402.5 million from the stock offering, and another $331.4 million from Sprint Nextel, its largest customer and shareholder.
The funding prevented Clearwire from potentially missing out on a debt payment, a threat the company laid out publicly during its negotiations with Sprint. The company initially planned a $300 million stock offering, but boosted the size to $350 million amid higher demand.
The company plans to use the proceeds for its general operations and to upgrade its older WiMax network to a standard called TD-LTE, which shares its roots with the LTE network that Verizon Wireless and AT&T are building. Clearwire previously said it needs $150 million to $300 million to continue its network operations, and another $600 million to upgrade its network. CEO Eric Prusch previously told CNET that the build-out would take 12 months to finish once it obtains the financing.
Clearwire was flailing for a while until Sprint earlier this month backed Clearwire with up to $1.6 billion in funding.
