Sprint to help finance Clearwire’s 4G LTE network

By on November 4, 2011 at 11:15 AM.

Sprint to help finance Clearwire’s 4G LTE network

Sprint announced on Friday that it will offer new notes due in 2018 and 2021, the proceeds of which may be used in part to finance Clearwire’s build-out of a 4G LTE network. “The company intends to use the net proceeds from the offering of the Notes for general corporate purposes, which may include, among other things, redemptions or service requirements of outstanding debt, network expansion and modernization and potential funding of Clearwire Corporation, and its subsidiary, Clearwire Communications LLC,” Sprint said in a press release. The news follows Sprint’s analyst day on October 7th, where executives from the nation’s No. 3 carrier distanced themselves from Clearwire despite owning a controlling stake in the company, and announced plans to spend $10 billion building out their own 4G LTE network. It is unclear how today’s news will impact those plans. Clearwire announced in August that it hoped to adopt LTE technology across its network, but it also said it would need outside funding in order to do so. Sprint’s full press release follows below. More →

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After $15.5 billion splurge on iPhone, Sprint may need $7 billion in new financing

By on October 27, 2011 at 7:30 PM.

After $15.5 billion splurge on iPhone, Sprint may need $7 billion in new financing

In addition to the costs needed to upgrade its network to LTE by next year, Sprint said earlier this week that it is paying Apple $15.5 billion during the next four years for the iPhone. That huge cost means the carrier may need an additional $7 billion in financing to help boost liquidity, Reuters said on Thursday. Reportedly, Sprint is seeking $3 billion of the additional funds from vendor deals and an additional $4 billion in refinanced debt. “[The] iPhone has an expensive contract, but it is worth every penny,” Sprint CEO Dan Hesse said on a recent conference call in reference to the money it pays Apple on each iPhone phone. Sprint pays Apple a subsidy fee that is 40% larger than any other handset it sells, but the carrier also said the iPhone has been the fastest-selling handset it has ever launched. On Wednesday, Sprint said it was negotiating a new network sharing deal with Clearwire that would extend beyond 2012. Several analysts think Sprint may be trying to juggle too much at once, however. “They’re betting the house on two things at the same time,” Mizuho analyst Michael Nelson told Reuters. “If they pull it off, great. If they don’t, their financial performance would get materially worse, and they could have significant liquidity risks.” More →

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