Clearwire, Sprint Nextel to form $14.55B wireless company

The new company, to be named Clearwire, will receive a $3.2 billion investment from Intel Corp., Google Inc., Comcast Corp., Time Warner Cable Inc. and Bright House Networks. The investment is based on a target price of $20 per Clearwire share and will give the companies a 22 percent stake in the new venture.

Overland Park, Kan.-based Sprint Nextel Corp. will be majority owner with a 51 percent equity stake, while existing Clearwire shareholders will receive about 27 percent interest.

Clearwire, which will concentrate on rolling out a mobile network based on the emerging WiMAX standard, will also receive an investment from Trilogy Equity Partners, led by U.S. wireless industry veteran John Stanton.

WiMAX promises faster download speeds than the latest networks run by cell-phone operators, and it's even seen as a potential competitor to fixed-line broadband.

Rivals such as AT&T Inc. and Verizon Wireless have eschewed WiMax, opting instead for upgrades to their current wireless broadband networks and a future technology called Long Term Evolution.

Clearwire already provides wireless Internet service in some parts of the country, using a WiMax-like technology. The company had a subscriber base of nearly 400,000 wireless broadband customers at the end of 2007.

The new company is looking for a U.S. network deployment between 120 million and 140 million people by the end of 2010.

Sprint and Clearwire, a startup founded by cellular pioneer Craig McCaw, had already announced their plans to build out networks using WiMAX technology, but had been looking for outside funding.

The new company will be led by Clearwire Chief Executive Benjamin Wolff, with Sprint Chief Technology Officer Barry West serving as president. West also leads Sprint's XOHM division.