Clearwire Corp has received a full acquisition offer from its majority-stake owner Sprint Nextel Corp. Sprint has offered $2.1 billion to buy all the remaining shares currently owned by other corporations. Clearwire says that it is reviewing the offer while not revealing any other information regarding the deal.
This news gave a 10% jump to Clearwire’s shares in early trades, with shares going up to $3.04. Sprint offered $2.90 per share and the increase in price suggests that the shareholders want Sprint to increase its initial offer if it wants to secure the deal.
While the proposed price currently represents a 5 percent premium on Clearwire’s stock price on Wednesday, it is still 20 percent higher than the closing price on the day before this news was leaked. Many analysts believe that it is likely that Sprint’s offer might get rejected by Clearwire’s shareholders. Others believe that Sprint’s offer of $2.1 billion seems small when compared to other acquisition offers involving companies that hold wireless spectrums.
Although Sprint holds majority share and control over Clearwire, the carrier is interested in having full control over the company as well as its spectrum so that it helps in bolstering its wireless data services.
If Sprint is able to buy Clearwire at $2.1 billion then the total worth of the company will become $4.2 billion, as 50.4 percent of shares are already owned by Sprint. Clearwire is in trouble when it comes to its finances. The company has previously revealed that it could run out of money in the third quarter of 2013, which makes Sprint’s offer viable, if it wants to survive.
Sprint, on the other hand, is also going to be bought by Japanese mobile firm Softbank. Sprint’s acquisition by Softbank will provide it with enough funds to go on with Clearwire’s buy out.