Clearwire to raise $595M via stock offerings

Clearwire (NASDAQ:CLWR) plans to raise a total of at least $595 million in stock offerings as it seeks to bolster its balance sheet ahead of its planned LTE network buildout.

Clearwire said it will sell $300 million of its Class A Common Stock in a registered public offering. Clearwire also said it expects to grant the offering underwriters a 30-day option to purchase up to an additional $45 million of its Class A stock.

Separately, Sprint Nextel (NYSE:S), which owns the majority economic interest in Clearwire, will purchase $295 million of Clearwire's Class B Common Stock in a private transaction, Sprint spokesman Scott Sloat confirmed to Bloomberg. As part of a wide-ranging series of agreements the two companies announced last week to fund Clearwire and collaborate on LTE deployments, Sprint said that if Clearwire raised new equity between $400 and $700 million, it would participate in the offering and contribute up to $347 million. 

J.P. Morgan, Bank of America Merrill Lynch and Jefferies & Company are acting as joint book-running managers for the proposed offering.

The new funding comes just days after Sprint and Clearwire announced funding deals worth up to $1.6 billion over four years. Taken together with the stock offerings, the transactions should give Clearwire a significant funding cushion as it moves ahead with plans to deploy a TD-LTE network over at least part of its existing WiMAX network. "This is transformative," Credit Suisse analyst Jonathan Chaplin told Bloomberg. "This was a company flirting with bankruptcy just a week ago."

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

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