Sprint reportedly in talks for Clearwire takeover
Sprint is talking with Clearwire's other investors about an additional investment that may lead to Sprint buying out the remaining stake in Clearwire.
Sprint Nextel is in talks with the cable companies over a new round of investment that may lead to a full takeover of 4G partner Clearwire, according to Bloomberg.
Sprint is in discussions with investors Comcast, Time Warner Cable, and Bright House Networks, Bloomberg reported today, citing anonymous sources. The report said Sprint is weighing using the investment to fund the acquisition of the remaining stake in Clearwire that it doesn't own.
Such a scenario could provide relief to cash-strapped Clearwire, which is seeking funding to stay alive and expand its network with a. The company needs $600 million for its network upgrade and additional money to keep its operations going.
Sprint, with a 54 percent stake in Clearwire, is both its largest shareholder and customer. While many believe it is logical for Sprint to absorb Clearwire, Sprint is hesitant to make a deal because it doesn't want Clearwire's losses and debt to weigh on its balance sheet and quarterly results. But Clearwire is quickly reaching a point where it needs help.
Both Clearwire and Sprint declined CNET's requests for comment.
Sprint is also talking with other cable providers Cablevision and Cox Communications. Cox recently attempted to strike out on its own with a wireless network, but ended up scuttling the project because of the cost and lack of interest.
Sprint, meanwhile, needs the additional resources Clearwire's 4G network can bring. Clearwire has already been instrumental in Sprint's recovery over the past year, as customers began to take a second look at the carrier and its 4G offering. But much of that advantage has disappeared with Verizon Wireless launching its own faster 4G network.
More recently, Clearwire's funding issue have led to a halt in the expansion of its network into new markets. At the same time, Verizon recently said it hadwith its recent addition of new markets.
Updated at 6:09 a.m PT: to include Sprint's response.