Sprint's stock surges on potential Softbank deal

Wedding season for wireless
Wedding season for wireless

Shares of Sprint Nextel surged Thursday as it negotiated with Japanese wireless carrier Softbank, which might buy a controlling stake in the company.

Sprint Nextel's (S) stock jumped 18% in morning trading.

"Sprint is currently involved in discussions with Softbank regarding a potential substantial investment by Softbank in Sprint," said Sprint in a prepared statement.

Sprint said "such a transaction could involve a change of control," but it emphasized that there are "no assurances" that the deal will go through.

The share price for Internet service provider Clearwire (CLWR) also surged, climbing 40% in morning trading, as CNBC reported that Clearwire might also get taken over as part of the deal.

Sprint Nextel is the third-largest wireless carrier in the United States, trailing AT&T (T) and Verizon (VZ) in market share. But the company has continued to lose money, despite finally adding Apple's (AAPL) iPhone to its network last year.

Related: M&A drought not letting up

A spokesperson for Softbank Corp (SFTBF) was not immediately available for comment.

There had been speculation that Sprint Nextel would make a counteroffer for MetroPCS (PCS), which recently agreed to merge with Deutsche Telekom's T-Mobile USA unit. Shares of MetroPCS fell 5% in early trading.

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