Clearwire Will Access $80 Million Credit Line From Sprint
In a press release issued today, Clearwire has announced that it intends to use an $80 million financing draw in March, made available by its agreement with Sprint Nextel . The financing arrangement between Clearwire and Sprint comes in the form of notes, which, upon meeting certain conditions, can be exchanged for one share of Clearwire stock at $1.50 a piece.
Two additional financing draws were available as part of the Sprint agreement; however, Clearwire elected not to use them. A special committee of Clearwire's board of directors has not determined whether to use any, or all, of the remaining three financing draws available in August, September, and October. Both Clearwire and Sprint did, however, reach an agreement to remove conditions surrounding the future financing alternatives, should Clearwire opt to use them.
It is uncertain what effect, if any, Clearwire's decision to access Sprint's financing option will have on DISH Network's Jan. 8 proposal to acquire up to all of Clearwire's outstanding stock for $3.30 per share. The DISH Network proposal came several weeks after Sprint offered to purchase the shares of Clearwire it doesn't already own, for $2.97 a share. The Clearwire special committee intends to continue discussions with both DISH and Sprint regarding its acquisition alternatives.
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