Both Sprint and Nextel have been struggling financially, but Sprint recently agreed to sell 70 percent of itself to Softbank Corp. in a deal worth about $20 billion. Clearwire shares jumped on that news as investors concluded that Sprint would offer to buy Clearwire. Shares of Clearwire were trading at $1.30 at the time.
Clearwire's main asset is vast swaths of wireless spectrum, or space on the airwaves, that could be used to provide high data download speeds. Those are a crucial competitive factor in today's wireless industry. However, Clearwire's frequencies are difficult to use: they require many cell towers to cover an area, and the signals don't penetrate well into buildings.