Sprint has just acquired Clearwire for $2.2 billion, which is just $100 million more than its previous offer. That’s the highest amount that Softbank, Sprint’s new major investor, would allow the company to offer for the acquisition of Clearwire.
For a second there it almost looked like Sprint wouldn’t be able to acquire Clearwire, partly due to the ceiling that Softbank placed on their bid, and because the Clearwire shareholders wanted at least $5-$8 per share of the company. Luckily for Sprint, as well as Softbank, over 50% of the Clearwire shareholders, with 13% of them composed of Comcast, Intel, and Bright House Networks, were convinced to sell their shares a $2.97 a piece.
Erik Prusch, Clearwire’s CEO and President, stated,
“Our board of directors has been reviewing available strategic alternatives over the course of the last two years. In evaluating available alternatives, a special committee conducted a careful and rigorous process, and based on the committee’s recommendation, our board unanimously determined that this transaction, which delivers certain and attractive value for our shareholders, is the best path forward.”
By attaining Clearwire, Sprint has access to Clearwire’s 2.5GHz spectrum assets. Clearwire will also received $800 million more in funds to build out its LTE network; one that will complement Sprint’s LTE network.
With the acquisition of Clearwire, and for a steal as well, Sprint now has the means to compete with the big dogs, AT&T and Verizon Wireless.
Dan Hesse, CEO of Sprint, stated,
“Today’s transaction marks yet another significant step in Sprint’s improved competitive position and ability to offer customers better products, more choices and better services. Sprint is uniquely positioned to maximize the value of Clearwire’s spectrum and efficiently deploy it to increase Sprint’s network capacity. We believe this transaction, particularly when leveraged with our SoftBank relationship, is further validation of our strategy and allows Sprint to control its network destiny.”
The deal still has to go through regulatory approval, but if/when it does, everything will be finalized in mid-2013.