Clearwire Climbs on Sprint Buyout Offer
NEW YORK (TheStreet) -- Shares of Clearwire (CLWR) climbed in premarket trading Thursday after Sprint (S) revealed its intention to buy out the wireless specialist.
In a filing with the Securities and Exchange Commission, Sprint said that it plans to acquire Clearwire stock that it does not already own for $2.90 a share, a deal worth around $2.1 billion.
Clearwire shares gained 11.64% to reach $3.07 before market open. Sprint's stock dipped 0.35% to $5.64.
Speculation has swirled for months that Sprint, Clearwire's largest shareholder, would acquire the 4G specialist.
The Overland Park, Kan.-based firm owns 51.7% of Clearwire, according to the SEC filing. In October, Japanese firm Softbank reached a $20.1 billion deal to acquire a 70% stake in Sprint. The huge injection of capital is seen as bolstering Sprint's arsenal in the telecom battle against AT&T (T) and Verizon (VZ). Sprint has provided its Clearwire proposal to Softbank for review, according to the regulatory filing. The consolidation trend in the telecom sector has been gathering pace. Last month, U.S. Cellular (USM) announced a $480 million deal to sell its Chicago, St. Louis, central Illinois and three other Midwest markets to subsidiaries of Sprint. Clearwire shares rose earlier this week, lifted by media reports that Sprint (S) is in talks with Intel and Comcast (CMCSA) to buy out their stakes in Clearwire. --Written by James Rogers in New York. Follow @jamesjrogers >To submit a news tip, send an email to: tips@thestreet.com.Select the service that is right for you!
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