Sprint made clear on Monday that even though it relies on Clearwire for its 4G wireless products, there are no plans to purchase the struggling company.
Clearwire earlier on Monday raised $675 million in a debt offering and hopes to raise about $650 million more. The debt sale comes as Clearwire has warned its running out of cash and having difficulty staying afloat. The Washington-based carrier has gone so far as to lay off more than 15 percent of its workforce, and halt expansion plans, because of its financial problems. And Sprint has a high debt load of its own to worry about.
Meantime, Sprint and Clearwire continue to talk about investment, Sprint said. It sounds, though, like Sprint the third-largest mobile service provider in the United States is reluctant to acquire another company as it still feels the ripple effects of the disastrous Nextel takeover.
Overall, the situation raises the question of whether Sprint wouldnt be better off looking for ways to move into the LTE arena. WiMAX has seen slower-than-predicted adoption in the United States; despite the 4G standards success in other countries such as Russia, the competing LTE protocol has found a home in the U.S., notably with AT&T and Verizon Wireless. Clearwire has said its testing its network to see if it can run WiMAX and LTE side by side, but little seems to have come of those trials.
Shares of Sprint were trading a penny higher by about 2:!5 p.m. Eastern, at $4.38. Clearwires shares had fallen more than 3 percent by the same time, to $5.85.