Clearwire Plans $1.1 Billion Debt Offering

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Cash-strapped wireless broadband provider Clearwire announced plans to raise more than $1.1 billion through a debt offering, which should keep the company afloat through at least the end of 2011.

The company is majority-owned by Sprint Nextel, with additional investment from Comcast, Time Warner Cable, Bright House Networks, Google and Intel.

Clearwire intends to use the net proceeds for working capital and for general corporate purposes, including capital expenditures. Earlier this month, the Kirkland, Wash.-based company said it would lay off 15% of its workforce, cut back sales and marketing spending and take other cost-cutting measures.

The company also has been looking to raise cash by selling portions of its 2.5-GHz wireless spectrum holdings.

Clearwire's 4G network now serves 68 markets covering 103 million people in the U.S., including in New York, Los Angeles, Chicago, Houston and Philadelphia. The company expects to have more than 4 million subscribers by the end of 2010.

Clearwire will offer $175 million first-priority senior secured notes due 2015, $500 million of second-priority secured notes due 2017 and $500 million of exchangeable notes due 2040. It will grant the initial purchasers of the exchangeable notes an option to purchase up to an additional $100 million of exchangeable notes, the company said.

Also Thursday, Clearwire announced that Sprint has nominated William R. Blessing, Mufit Cinali and Hossein Eslambolchi to Clearwire's board of directors. Their election is expected to occur at the next meeting of the board on Dec. 10, 2010. The nominees, if elected, would fill Clearwire's three current open seats on its board of directors.

In addition, Clearwire debuted the Clear Modem with Wi-Fi, a dual-mode adapter that combines 4G WiMax with Wi-Fi wireless connectivity.

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