Clearwire eyes debt as part of new funding

NEW YORK (Reuters) - Clearwire Corp expects its next funding round to be debt with an equity investment from a company such as T-Mobile USA or money from a wireless spectrum sale, its chief executive said on Thursday.

Clearwire, a wireless venture that is majority owned by Sprint Nextel Corp, is in negotiations for additional funding for building a high-speed network.

Clearwire’s preference would be to get an equity investment from a strategic partner that would also rent wireless network space at a special wholesale rate, said CEO Bill Morrow, similar to Clearwire’s arrangement with Sprint.

The company is in talks with No. 4 US mobile service T-Mobile USA, a unit of Deutsche Telekom, about a deal under which T-Mobile would take an equity investment and rent space on Clearwire’s network.

“In the event we don’t come to an equity arrangement, they could be a wholesale customer,” Morrow said at a Goldman Sachs conference.

If T-Mobile USA does not become an investor, it would have to pay a higher rate for using the Clearwire network, he said.

Morrow is also in talks about a sale of wireless airwaves it does not need, in case the company fails to get another partner. Morrow said the prospects of alternative options will help Clearwire get a better deal.

“By putting the spectrum sale on the table, other considerations get better for us,” Morrow said.

He said he will decide by the end of the year.

Another Clearwire investor, cable operator Comcast Corp, said earlier this week that it does not plan to invest more equity in Clearwire above its 9 percent stake.

Morrow said U.S. regulations would require both companies to combine their spectrum holdings if Comcast increased its stake to 10 percent.

Sprint has said it could invest more in Clearwire. It has also said it would like to own the whole venture, but its Chief Financial Officer Bob Brust said last week that this would be too expensive right now.

Shares in Clearwire closed up 10 cents at $7.40 on Nasdaq.

Reporting by Sinead Carew. Editing by Robert MacMillan