How Many Dimes Will it Take to Buy Clearwire?

On Thursday, mobile and wireless service provider Clearwire made it public that Sprint Nextel has officially made an offer to acquire the company. While the outcome of the purchase offer is uncertain, it did not come unexpectedly. Many have speculated that such a deal was looming on the horizon, especially after Sprint purchased a controlling share (raising their stake to 50.8%) of Clearwire stock in October.

Clearwire Cachet

Sprint, once synonymous with “10 cents a minute” calls, has long been a powerful shareholder in the Clearwire Corporation, while companies like Comcast and Time Warner Cable own smaller portions. Clearwire’s portion of the spectrum and their status as fifth largest wireless provider in the nation ought to be enough incentive for the purchase, but analyst Jeff Kagan postulates that Sprint has other reasons for pursuing the deal at this time.

Indeed, Sprint is on the verge of selling over 70% of their company to Japanese telecom giant SoftBank, and adding Clearwire to their stables is sure to sweeten the deal. Sprint needs to put as much technology under their umbrella as quickly as possible to get the deal done,” says Kagan. “Without that, Sprint may be lovable, but it’s like a three-legged dog.” Either way, the SoftBank purchase still awaits the FCC’s approval.

So how much is Clearwire going for? Well, Bloomberg estimates Sprint’s initial offer at $2.1 billion, but the pending deal is driving up Clearwire stock prices, so analysts predict that Clearwire will hold out for a better offer. Bold, for a company that is expected to post a $1 billion net loss for 2012, but if Sprint’s $20 billion deal depends on Clearwire, then you can expect they’ll probably cough up the extra money.

To answer the titular question, then: 21 billion dimes…and counting!


photo credit: starmist1 via photopin cc

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Brent Urmey is an avid reader and writer on a variety of subjects, including social media, SEO, the Wireless industry, and life in Lancaster County, PA. He is a graduate of Drexel University and a survivor of the 2012 Mayan Apocalypse. You can connect with Brent on Google +.