Is Sprint Cold-Shouldering Clearwire?

Sprint (NYSE:S) distanced itself from troubled broadband provider Clearwire (NASDAQ:CLWR) to avoid claims from the latter’s creditors in the event of its default on outstanding debt.

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Last year Sprint ceded control of Clearwire’s board by giving up voting rights on its shares. Sprint followed up that move by under-subscribing to its rights in Clearwire’s December issue of capital to raise funding for its new LTE network build. Though new investors pumped in $402.5 million, Sprint ponied up only $331.4 million – and thereby also surrendered majority ownership in Clearwire.

With its holding well below 50 percent, Sprint has now reclaimed the voting rights it surrendered last year. Sprint spokesman Scott Sloat reportedly told Reuters: “Now that our economic interest has fallen below 50 percent, we are reclaiming our full voting rights so that our voting rights and economic rights are once again aligned.”

Even on the operational front, Sprint’s reliance on Clearwire’s WiMAX service and LTE broadband capacity could be diluted when Sprint floats its own LTE offering this coming summer and slowly turns down its use of WiMAX.

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