Clearwire Corp. on Tuesday announced closing equity financing that the wireless operator said was critical to enable it to build a new high-speed network.
Thanks to the funding, $715.5 million is available to Clearwire, which raised gross proceeds totaling $734 million.
Bellevue, Wash.-based Clearwire raised net proceeds of $384.1 million by closing a public offering of 201,250,000 shares of Class A common stock at $2 per share and selling 26,250,000 shares of the same type of common stock to the underwriters. Sprint Nextel Corp., which owns a majority stake in Clearwire, also exercised an option to purchase 173,635,000 shares of Class B common stock and a corresponding number of Class B units in Clearwire Communications LLC. Those transactions provided Clearwire another $331.4 million in net proceeds.
“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.”
Shares of Clearwire (NASDAQ: CLWR) were trading at $2.10 as of 11:53 ET. Over the last year, the stock price has ranged from a high of $6.11 to a low of $1.24.
A few weeks ago, Clearwire announced reaching agreements with Sprint over the next four years that are worth up to $1.6 billion. Part of that $1.6 billion figure reflects the new equity financing from Sprint, a Clearwire spokesperson confirmed. Clearwire ended the third quarter with 1.32 million retail subscribers and 8.22 million wholesale subscribers, most of whom are Sprint’s 3G/4G smartphone customers.