Sprint Nextel says it supports a network accord between Clearwire and Deutsche Telekom AG’s T-Mobile USA, according to a Bloomberg Report that cites comments from Goldman, Sachs & Co. analyst Jason Armstrong.
According to Armstrong, who had a meeting with Sprint CEO Dan Hesse and CFO Tom Brust on Dec. 1, Sprint would support an equity infusion into Clearwire by T-Mobile.
A deal between the two would allow T-Mobile to buy capacity on Clearwire’s WiMAX network to supplement its existing HSPA+ network. Armstrong said negotiations between Clearwire and T-Mobile likely would continue but that there was no commitment by either side to ink a deal by year’s end, according to Bloomberg.
Clearwire has struggled recently to make ends meet in the face of strong competition from the likes of Verizon Wireless, which is launching its LTE network in 38 markets. Additionally, Clearwire was recently forced to lay off 600 workers as it wrestles with a major cash crunch.
Clearwire will run out of cash as early as the middle of next year without additional funding, according to Sprint SEC filings. In Clearwire’s recent 10-Q filing with the SEC, the company expressed concerns about whether it could continue without further funding.
Clearwire today announced plans to raise over $1.1 billion through the offering of debt securities in private placement transactions.