Sprint Nextel Corp. and Clearwire Corp. announced today they have canceled their plan to combine the high-speed wireless networks they are building. The two companies originally announced the agreement this July, but were unable to "resolve complexities" in the deal, resulting in the abandonment of the plan. The breakup is a blow to the much smaller Clearwire, whose WiMax network would"ve been complemented by Sprint"s coverage using the same technology. Investors certainly felt less confident in the company as shares of Clearwire fell $4.54, or 25 percent, to close at $13.49 after sliding as low as $13.03, an all-time low.
"The termination of the agreement certainly dramatically impacts the longer-term financial pressures on Clearwire and its aggressive build-out strategy," said analyst Christopher King at Stifel Nicolaus.