Clearwire on Tuesday announced it has raised a total of $715.5 million through a public stock offering and in a private transaction with majority owner Sprint Nextel to help fund its buildout of a nationwide Long Term Evolution overlay on its WiMax network.
The company said it closed its public offering of 201.25 million shares of Class A common stock at $2.00 per share originally announced on Dec. 5, resulting in net proceeds of $384.1 million after underwriters' discounts and commissions.
In addition, Sprint purchased 173.6 million shares of Class B common stock to maintain its voting interest, providing an additional $331.4 million in net proceeds. The total net new capital available to Clearwire following today's closings is $715.5 million. On Dec. 1, Clearwire reached an agreement with Sprint, which agreed to provide up to $1.6 billion in payments and funding to Clearwire over the next four years.
"This equity raise is a critical step for Clearwire to achieve its long-term business plan of creating the first wide-channel TDD-LTE 4G network in the U.S.," Clearwire president and CEO Erik Prusch said in a statement. "The added resources will enable us to continue delivering 4G mobile broadband service to meet the rapidly growing demand in the industry. We remain ideally and uniquely positioned to serve both wholesale and retail customers well into the future."
Separately, Comcast and Time Warner Cable -- which are investors in Clearwire -- have said that within six months they will no longer offer wireless broadband services through the WiMax provider. Instead, Comcast and TWC (as well as Bright House Networks) will exclusively resell Verizon Wireless products and services under the terms of an agreement announced Dec. 2 that included the sale of Advanced Wireless Services spectrum licenses to Verizon Wireless for $3.6 billion.