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Sprint (S) Proposes To Buy Rest Of Clearwire (CLWR) For $2.90/Shr

 December 13, 2012 07:37 AM

(By Balachander) Sprint Nextel Corp. (NYSE: S) has offered to acquire shares in Clearwire Corp. (NASDAQ: CLWR) it does not already own for $2.90 per share, a regulatory filing showed.

Clearwire shares jumped 8.36 percent in pre-market trading on Thursday, following the news.

Sprint's proposal represents a 5.5 premium to CLWR's previous closing price.

The announcement confirmed market rumors that Sprint would buy all of Clearwire following its $20.1 billion deal with Japan's Softbank.

With the latest move, Sprint has more control over Clearwire's spectrum assets, which is crucial for Sprint's high-speed wireless network.

[Related -Sprint Corporation (S): Sprinting To $10?]

Sprint, the third largest wireless carrier in the U.S., owns a 51.7 percent stake in Clearwire as of Dec. 13.

In October, Sprint's board approved a deal under which Softbank will acquire roughly 70 percent of Sprint in the largest Japan outbound deal on record. In the same period, Sprint boosted its stake in Clearwire to 50.8 percent, buying 30.9 million of Clearwire's Class A shares and 2.73 million of its Class B shares from telecom investor Craig McCaw's investment vehicle Eagle River Holdings LLC.

Clearwire's 4G network spans the nation and covers over 130 million people in around 80 U.S. markets. Clearwire has publicly stated that it has 60 MHz of spectrum beyond its operating needs in the top 100 Metropolitan Statistical Areas (MSAs). Clearwire owns or leases spectrum covering about 46.6 billion MHz-POPs nationwide.

[Related -Sprint Corporation (S): Flexing Spectrum Muscle Amid Network Evolution]

Sprint shares ended at $5.66 on Wednesday.

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