Clearwire finally shores up its financing

The company raised $734 million in the latest stock offering, which includes a healthy contribution from majority shareholder Sprint Nextel.

Clearwire shareholders and customers can breathe a sigh of relief now.

The wholesale 4G network provider said today it raised $734 million in its latest stock offering, shoring up its cash position just as it was facing potential issues meeting its financial obligations. The funds include $402.5 million from the stock offering, and another $331.4 million from Sprint Nextel, its largest customer and shareholder.

The funding prevented Clearwire from potentially missing out on a debt payment, a threat the company laid out publicly during its negotiations with Sprint . The company initially planned a $300 million stock offering, but boosted the size to $350 million amid higher demand.

The company plans to use the proceeds for its general operations and to upgrade its older WiMax network to a standard called TD-LTE, which shares its roots with the LTE network that Verizon Wireless and AT&T are building. Clearwire previously said it needs $150 million to $300 million to continue its network operations, and another $600 million to upgrade its network. CEO Eric Prusch previously told CNET that the build-out would take 12 months to finish once it obtains the financing .

Clearwire was flailing for a while until Sprint earlier this month backed Clearwire with up to $1.6 billion in funding .

About the author

Roger Cheng is the executive editor in charge of breaking news for CNET News. Prior to this, he was on the telecommunications beat and wrote for Dow Jones Newswires and The Wall Street Journal for nearly a decade. He's a devoted Trojan alum and Los Angeles Lakers fan.

 

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