Investors in the Clearwire wireless data consortium have agreed to pony up an additional $1.5 billion in capital to fund the expansion of its national WiMax network.
According to a statement, Sprint Nextel will contribute $1.2 billion, Comcast $196 million, Time Warner Cable $103 million, Intel $50 million, Eagle River $20 million and Bright House Networks $19 million. In return, the partners will receive newly issued shares of Clearwire valued at $7.33 per share. Clearwire shares closed at $6.80 each on Nov. 9 and were trading at $6.88 each in late morning trading Tuesday.
Clearwire also announced that it will launch a separate offering of senior notes for $1.45 billion to pay off its existing credit facility and will launch a common stock rights offering to existing shareholders.
"This additional level of strategic funding marks another important milestone in the progress of Clearwire, and will enable us to maintain our leadership and aggressive 4G WiMax network build plans," said Clearwire CEO Bill Morrow in a statement. "Today's news is also further validation of the importance of our 4G network to our strategic investors. We all benefit from this robust, all-IP, high-bandwidth network that delivers an unmatched combination of Internet speed and mobility."
Clearwire announced the consortium last year, with the partners contributing $3.2 billion to fund a national WiMax network. Clearwire has launched the service in about 24 markets, including Portland, Ore., Atlanta and Philadelphia.