Clearwire rakes in USD715.5m from shareholders

14 Dec 2011

US WiMAX operator Clearwire has announced that it has raised USD715.5 million from its shareholders to fund ongoing network expansion plans. As previously reported by TeleGeography’s CommsUpdate, the telco intends to roll out a Long Term Evolution (LTE) network targeting ‘densely populated, urban areas of Clearwire’s existing 4G markets where current 4G usage demands are high’. The company raised USD384.1 million from the sale of common shares, whilst majority shareholder Sprint Nextel exercised its pre-emptive rights and snapped up USD331.4 million worth of ‘class B’ shares. Erik Prusch, president and CEO of Clearwire, said: ‘This equity raise is a critical step for Clearwire to achieve its long-term business plan of creating the first wide-channel TD-LTE 4G network in the US. The added resources will enable us to continue delivering 4G mobile broadband service to meet the rapidly growing demand in the industry. We remain ideally and uniquely positioned to serve both wholesale and retail customers well into the future’.

Recent months have seen the WiMAX operator dogged with speculation over how it intends to fund its LTE network, but on 1 December Clearwire and Sprint announced that the latter had committed to provide additional equity funding to Clearwire in connection with a public offering meeting certain requirements. Clearwire has confirmed that this exercise of Sprint’s pre-emptive rights satisfies its obligation. Going forward, Sprint will continue to use Clearwire’s WiMAX network until 2015, whilst Clearwire is obliged to achieve certain rollout milestones by June 2013. The agreement also established long-term, usage-based pricing for LTE services for 2012 and beyond.

United States, Clearwire, Sprint Corporation (now part of T-Mobile US)