Sprint Nextel and Clearwire are close to announcing a $12 billion joint venture with major cable operators for high speed wireless Internet access for mobile phones and laptops, a
source familiar with the talks said Tuesday.
An announcement is expected to come before the market opens Wednesday morning, the source said.
Spring shares were about 5 percent higher in extended electronic trading, while Clearwire jumped around 7 percent. During regular market hours, Sprint ended up 5.39 percent, at $9.19 on the New York Stock Exchange; Clearwire closed up 8.50 percent, at $16.46 on the Nasdaq.
The Wall Street Journal first reported the news on its Web site.
Sprint, Clearwire and cable companies including Comcast and Time Warner Cable have been in talks about a joint venture using WiMax that would have investments of about $1.5 billion by the two largest U.S. cable companies, according to people familiar with the discussions.
Comcast is expected to contribute $1 billion, while Time Warner Cable will invest $550 million.
In addition, Intel is expected to contribute $1 billion, and Google $500 million. Bright House Networks, the sixth-largest U.S. cable provider, has also been involved in the discussions, according to the sources, and may contribute up to $200 million.
WiMax is a largely unproven technology that promises to support Internet access at speeds up to five times faster than traditional wireless networks, and can support a range of mobile and video applications.
The cable companies pulled out of a previous wireless phone joint venture with Sprint last month.
Sprint, Comcast and Time Warner Cable declined to comment.
Clearwire was not immediately available.