Clearwire investor Crest to urge FCC to block Sprint/Clearwire deal

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Crest Financial, a minority investor in Clearwire (NASDAQ:CLWR), said it will ask the FCC to halt both Sprint Nextel's (NYSE:S) proposed $2.2 billion acquisition of Clearwire as well as Softbank's $20.1 billion deal to acquire 70 percent of Sprint.

Crest, which owns around 8.3 percent of the non-Sprint shares in Clearwire, said it plans to file a formal complaint with the FCC before the Jan. 28 comment deadline on the two deals.

"Crest is optimistic that the FCC will take a close look at the transaction," David Schumacher, Crest's general counsel, said on a conference call with reporters, according to Bloomberg. "By artificially pushing down the price of Clearwire spectrum, Sprint and Clearwire threaten to devalue future government auctions of spectrum."

Sprint last month made a $2.97 per share offer to buy the 49 percent of Clearwire's shares it did not already own. Crest subsequently filed a lawsuit to block the deal, arguing it undervalues Clearwire's spectrum.

Clearwire declined comment, according to Bloomberg. Sprint declined to comment on the specifics of Crest's claims, but has called the firm's lawsuit "baseless and without merit," according to the Wall Street Journal.

Sprint's proposed acquisition of Clearwire is contingent on the Softbank deal closing, and the companies expect both deals to close by mid-2013.

Sprint is Clearwire's largest shareholder and by far its largest wholesale customer. Sprint's acquisition of Clearwire, if approved, would give Sprint complete control over Clearwire's TD-LTE network deployment, set for next year. Clearwire commands around 160 MHz of spectrum in the top 100 markets, and Sprint said its Network Vision network architecture would allow it to efficiently deploy TD-LTE.

For more:
- see this WSJ article (sub. req.)
- see this Bloomberg article
- see this Reuters article

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