Softbank caps Sprint's Clearwire bid, investors want more
Sprint Nextel Corp's $2.1 billion offer to buy out Clearwire Corp appeared to be running into trouble on Thursday, as some shareholders said they wanted more money while Softbank Corp set a cap on how much Sprint could pay.
Sprint, which owns 50.45 percent of Clearwire, offered $2.90 per share for the rest of the company and said it would also provide interim financing of $800 million to the cash-strapped company. Any deal would need approval by Softbank, which has agreed to buy 70 percent of Sprint for about $20 billion.
Clearwire shareholders, who together hold about 7.6 percent of the company, criticized the Sprint offer on Thursday, with some saying that the No. 3 U.S. wireless carrier should raise its bid to at least $5 per share. Holders of at least 24.8 percent of Clearwire's outstanding stock, other than Sprint, need to approve the deal.
Clearwire, which is reviewing the Sprint offer, saw its shares jump almost 15 percent on Thursday to $3.16, suggesting investors expected a higher price. But Softbank has told Sprint that it would not consent to any Clearwire bid higher than $2.97 per share, two sources close to the matter said. The threshold is the same price that Sprint recently paid to buy a small stake from Clearwire founder Craig McCaw's Eagle River Holdings LLC.
Sprint, Clearwire and Softbank declined to comment on the details of these discussions.
For Clearwire, the deal is one of the few options it might have to survive in
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