NEW YORK (AP) — Sprint is mending fences with independent subsidiary Clearwire, pledging to use the data network it’s planning to build out and to participate if Clearwire raises more capital.
Thursday’s announcement is a lifeline for Clearwire, which is struggling financially. It’s using a network technology called WiMax that has been bypassed by all phone companies except Sprint, and lacks the funding to upgrade to the industry’s standard technology.
Sprint Nextel Corp. now says it will collaborate with Clearwire Corp. on building the new network and expects to sell phones that can use it, starting in 2013. It will pay up to $350 million in advance for network capacity.
Clearwire will need more funding for the network. Sprint said it will participate in an offering, buying shares worth up to $347 million.
Clearwire shares climbed 27 percent to $2.26 in morning trading.