Clearwire and Sprint Nextel Merger in the Works
Posted on: Wednesday, 7 May 2008, 06:05 CDT
Clearwire and Sprint Nextel have announced that they will merge their wireless broadband units to create a new multi-billion dollar wireless communications company.
The company will be named Clearwire and will receive a $3.2 billion investment from Intel, Google, Comcast, Time Warner Cable and Bright House Networks based on a target price of $20 per Clearwire share that will give the companies a 22 percent stake in the new venture.
Sprint Nextel Corp., based in Overland Park, Kan., will own the majority of the company with a 51 percent equity stake. Existing Clearwire shareholders will receive about 27 percent interest.
Clearwire will concentrate on plans for a mobile network based on the emerging WiMAX standard. Trilogy Equity Partners, led by U.S. wireless industry veteran John Stanton, also plan to invest in the company.
WiMAX promises faster download speeds than current networks run by cell-phone operators. Many believe it has the potential to compete with fixed-line broadband.
AT&T and Verizon have opted out of WiMax and instead will continue upgrades to their wireless broadband networks as well a future technology called Long Term Evolution.
In some parts of the country Clearwire already provides a wireless service using a technology similar to WiMax. By the end of 2007 the company had a subscriber base of nearly 400,000 wireless broadband customers.
The new company expects a U.S. network deployment between 120 million and 140 million people by the end of 2010.
Sprint and Clearwire announced their plans to build networks using WiMAX technology, but had been looking for outside funding.
The new company will be led by Clearwire Chief Executive Benjamin Wolff, with Sprint Chief Technology Officer Barry West serving as president. West also leads Sprint's XOHM division.
Workers from Clearwire and Sprint's XOHM will be housed in Kirkland, Wash. and research and development and other operations will be located in Herndon, Va.
The board will consist of 13 members, seven of which will be named by Sprint—who will include at least one independent director. The investor group will name four members, including one independent. Eagle River, a private investment company controlled by wireless veteran Craig McCaw, will name one member. Clearwire’s nominating committee will select the remaining independent member.
McCaw is expected to serve as non-executive chairman. Sprint President and CEO Dan Hesse, Comcast Chairman and CEO Brian Roberts, Time Warner Cable President and CEO Glen Britt and Stanton are also expected to join the board.
The deal has been approved by the boards of all companies involved and is expected to close during the fourth quarter. The company will apply for a Nasdaq listing under the ticker "CLWR."
---
On the Net:
Source: redOrbit Staff & Wire Reports
Related Articles
- NeuStar's Wireless Message Routing Service to Power 3Cinteractive Platforms
- Sprint-Clearwire Split No Threat to WiMAX for M2M, Says ABI Research
- Sprint, Clearwire End WiMax Partnership
- Research and Markets: Analyze the Market for WiMAX 'Wireless Triple Play' Technologies
- World Wide Technology Wins State of Arizona Wireless Contract; Statewide Wireless Equipment and Services Purchasing Vehicle to Support Arizona Department of Transportation's Intelligent Transportation System Project
- Conterra Ultra Broadband Launches Wireless Broadband Access Service in 12 School Districts; 74 Districts Under Contract
- Cable Providers, Sprint Will Offer Wireless Video, Phone Services
- Action Engine Executives Speaking Worldwide at Mobile Events; Wireless Content and Services, Browser Versus UI, and the Future of Mobile Entertainment Among the Topics Presented
- AT&T Wireless Launching Music Service
- A4 Health Systems Selects Sprint and Nortel Networks for Converged Voice, Data, Wireless Contact Center Services
 |
 |
User Comments (0)
RSS Feeds