Sprint in talks to take control of Clearwire without an acquisition
The struggling wireless carrier is negotiating agreements that would give it the power to appoint a majority of directors on the wireless broadband provider's board, sources tell The Wall Street Journal.
Sprint Nextel may soon gain control of wireless broadband provider Clearwire without an acquisition, clearing up a stumbling block to Softbank's $20 billion acquisition of Sprint.
Sprint is Clearwire's largest customer and its largest shareholder with an 84 percent stake, but the No. 3 U.S. wireless carrier doesn't have control of Clearwire's board. To take control of the company, the No. 3 U.S. wireless carrier is negotiating agreements with other investors that will allow it to appoint a majority of directors to Clearwire's board without a making a formal acquisition, people familiar with the matter tell The Wall Street Journal.
Financial terms of the agreements were not revealed. CNET has contacted Sprint for comment and will update this report when we learn more.
Under a deal announced Monday, Softbank plans to spend $20.1 billion to take control of the struggling U.S. carrier. Leading up to the announcement of the deal, there were various reports that Clearwire was a sticking point in the merger talks, and that SoftBank wanted Sprint to acquire Clearwire.
Clearwire, which provides 4G services to carriers and consumers in select markets, controls wireless spectrum reportedly deemed valuable to Softbank. However, with Sprint already involved in a complicated transaction expected to take several months to get completed, the assumption was the company wouldn't further tangle itself up with another deal.