Greener planet is goal for 3 startups

If the glut of companies billing themselves as "solutions" providers is any indication, the world has no shortage of problems.

Green tech companies take on some of the most complicated, difficult problems to solve. They tend to be problems created by our mere existence, chief among them our massive demand for energy. The more we rely on energy to power our electronics, our vehicles and our lives, the more pollution we churn into our land, water and air.

The Tribune checked in with three local green tech startups at various stages of development. They haven't changed the world yet, but they're working on it.

COMPANY: LanzaTech

PROBLEM TO BE SOLVED: Global warming, a huge challenge as energy demand is expected to double within 40 years.

FUNDS RAISED: $100 million

It may sound like sci-fi, but LanzaTech produces gas-eating "bugs" that don't require oxygen to survive.

In April, the company's microscopic bacteria began ingesting carbon monoxide from a steel mill in China. Carbon monoxide goes in one end of the bacteria and ethanol comes out the other.

With a few genetic tweaks, the bug can produce a wide range of fuels and chemicals from gases that companies spend money to get rid of. The idea, says Jennifer Holmgren, the company's chief executive, is to trap nasty gases that float from steel mills, power plants and chemical factories, turning them into products that are useful and profitable.

The company recently inked a deal with Petronas, the national oil company of Malaysia, to develop a modified version of the bug that takes in carbon dioxide and produces acetic acid, a chemical companies need to produce polymers used in plastics.

"Rather than trying to sequester carbon deep into the earth, we will 'bury' it in a chemical," Holmgren said. "In this way, companies can not only comply with emissions reduction requirements, but also generate revenue along the way."

When Holmgren talks about the technology's potential, she pulls up a map of the world, showing partnerships and agreements the company has with companies from Boeing Co. in Chicago and Kansas-based Invista, the world's largest nylon producer, to Indian Oil Co. in New Delhi and Mitsui & Co. Ltd. in Japan.

Out of the company's various projects, the carbon monoxide-eating bacteria are the furthest along in the path toward commercialization. This month, LanzaTech finished a demonstration project for China's largest steel manufacturer, Baosteel, at a plant near Shanghai.

LanzaTech successfully produced the equivalent of more than 100,000 gallons of ethanol per year from just a fraction of the carbon monoxide the company creates in the steel-making process.

"You're literally driving for miles watching this steel mill," Holmgren said, explaining its vast size — and its potential to produce hundreds of millions of gallons of ethanol per year.

The technology creates a financial incentive to trap the gas rather than flare it, a common practice that produces carbon dioxide, which contributes to global warming. Through a series of pipes, the gas enters a vessel filled with the organism, which is floating in water. Fuel comes out the back end and is pumped through a distiller to create pure ethanol.

Because of the success of that demonstration, the steel company has ordered the first of what will eventually be three or four units, each about $80 million, that are each expected to produce 30 million to 50 million gallons of ethanol per year. Each unit pays itself back in under five years, Holmgren said.

"We don't want it to be green for green's sake. If it is, no one is going to use it," she said.

With 140 employees worldwide, LanzaTech doesn't have any revenues to report yet. Holmgren said LanzaTech expects to grow to profitability between 2013 and 2015.

COMPANY: Hybrid Electric Vehicle Technologies LLC

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Obama: 'We've been through this too many times'

A man killed his mother at their home and then opened fire Friday inside an elementary school, massacring 26 people, including 20 children, as youngsters cowered in fear to the sound of gunshots reverberating through the building and screams echoing over the intercom.

The 20-year-old killer, carrying at least two handguns, committed suicide at the school, bringing the death toll to 28, authorities said.

The rampage, coming less than two weeks before Christmas, was the nation's second-deadliest school shooting, exceeded only by the Virginia Tech massacre that claimed 33 lives in 2007.

"Our hearts are broken today," a tearful President Barack Obama, struggling to maintain his composure, said at the White House. He called for "meaningful action" to prevent such shootings, saying, "As a country, we have been through this too many times."

Police shed no light on the motive for the attack. The gunman, Adam Lanza, was believed to suffer from a personality disorder and lived with his mother, said a law enforcement official who was briefed on the investigation but was not authorized to discuss it.

Panicked parents looking for their children raced to Sandy Hook Elementary in Newtown, a prosperous New England community of about 27,000 people 60 miles northeast of New York City. Police told youngsters at the kindergarten-through-fourth-grade school to close their eyes as they were led from the building so that they wouldn't see the blood and broken glass.

Schoolchildren -- some crying, others looking frightened -- were escorted through a parking lot in a line, hands on each other's shoulders.

Law enforcement officials speaking on condition of anonymity said Lanza shot his mother, Nancy Lanza, then drove to the school in her car with at least three guns, including a high-powered rifle that he apparently left in the back of the vehicle, and shot up two classrooms around 9:30 a.m.

A custodian ran through the halls, warning of a gunman on the loose, and someone switched on the intercom, alerting people in the building to the attack -- and perhaps saving many lives -- by letting them hear the hysteria going on in the school office, a teacher said. Teachers locked their doors and ordered children to huddle in a corner or hide in closets as shots echoed through the building.

Authorities gave no details on exactly how the attack unfolded, but police radio traffic indicated the shooting lasted only a few minutes. State police Lt. Paul Vance said officers arrived instantaneously, immediately entered the school, searched it completely and found Lanza dead.

In addition to the 20 children, six adults were killed at the school; the principal was believed to be among the dead. A woman who worked at Sandy Hook Elementary was wounded.

A law enforcement official speaking on condition of anonymity said investigators believe Lanza attended the school several years ago but appeared to have no recent connection to the place.

At least one parent said Lanza's mother was a substitute teacher there. But her name did not appear on a staff list. And the law enforcement official said investigators were unable to establish any connection so far between her and the school.

Lanza's older brother, 24-year-old Ryan, of Hoboken, N.J., was being questioned, but a law enforcement official said he was not believed to have had a role in the rampage. Investigators were searching his computers and phone records, but he told law enforcement he had not been in touch with his brother since about 2010.

The officials spoke on the condition of anonymity because they were not authorized to discuss the unfolding investigation.

At one point, a law enforcement official mistakenly identified the gunman as Ryan Lanza. Brett Wilshe, a friend of Ryan Lanza's, said Lanza told him the gunman may have had his identification. Ryan Lanza apparently posted Facebook page updates Friday afternoon that read, "It wasn't me" and "I was at work."

Robert Licata said his 6-year-old son was in class when the gunman burst in and shot the teacher. "That's when my son grabbed a bunch of his friends and ran out the door," he said. "He was very brave. He waited for his friends."

He said the shooter didn't utter a word.

Stephen Delgiadice said his 8-year-old daughter heard two big bangs. Teachers told her to get in a corner, he said. "It's alarming, especially in Newtown, Connecticut, which we always thought was the safest place in America," he said. His daughter was uninjured.

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Apple falls on lower shipment forecasts, muted China debut

(Reuters) - Apple Inc shares fell 3.9 percent on Friday after the iPhone 5 debuted in China to a cool reception and two analysts cut shipment forecasts.

Jefferies analyst Peter Misek trimmed his iPhone shipment estimates for the Jan-March quarter, saying that the technology company had started cutting orders to suppliers to balance excess inventory.

Shares of Apple suppliers Jabil Circuit Inc, Qualcomm Inc, Skyworks Solutions Inc, TriQuint Semiconductor Inc, Avago Technologies Ltd, and Cirrus Logic Inc also fell in early trading.

Apple shares have lost a quarter of their value since they hit a life high of $705.07 on September 21, as it faces increasing competition from phones using Google Inc's Android operating system.

Misek cut his first-quarter iPhone sales estimate to 48 million from 52 million and gross margin expectations for the company by 2 percentage points to 40 percent.

UBS Investment Research cut its price target on Apple stock to $700 from $780 on lower expected iPhone and iPad shipments for the March quarter.

The brokerage said it was modeling more conservative growth for the world's biggest technology company after making supply chain checks that revealed that fewer iPhones were being built.

"Some of our Chinese sources do not expect the iPhone 5 to do as well as the iPhone 4S," UBS analyst Steven Milunovich wrote in a note to clients.

Apple launched the iPhone 5 in China on Friday, a move widely expected to bring the Cupertino-based company some respite from a recent slide in market share in China, but early reports indicated that demand may not be as great as expected.

"The iPhone 5 China launch has been surprisingly muted but (we) are unsure how much weather (snow) or the required pre-ordering (to prevent riots) are factors," Misek said.

Apple shares fell as low as $508.50 in morning trading on the Nasdaq on Friday.

(Editing by Supriya Kurane)

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AP NewsBreak: Yankees hit with $18.9M luxury tax

NEW YORK (AP) — The New York Yankees were hit with an $18.9 million luxury tax by Major League Baseball, the 10th consecutive year they will pay a penalty for their spending.

The team finished with a $222.5 million payroll for purposes of the tax, according to figures sent to teams Thursday and obtained by The Associated Press.

Following its payroll-shedding trade with the Los Angeles Dodgers last summer, Boston finished just $47,177 under the $178 million threshold. The Los Angeles Angels wound up at $176.7 million and Philadelphia at $174.5 million.

Figures include average annual values of contracts for players on 40-man rosters, earned bonuses and escalators, adjustments for cash in trades and $10.8 million per team in benefits.

New York has run up a luxury tax bill of $224.2 million over the past decade, with the fee increasing from $13.9 million last year. The Yankees' tax rate rose from 40 percent to 42.5 percent this year and figures to climb to 50 percent next season. But they hope to get under the threshold in 2014, when it rises to $189 million. Dropping under the threshold would lower their potential tax rate in 2015 to 17.5 percent.

"It affects my decision-making process, my communication about the pressure points we have," Yankees general manager Brian Cashman said, adding that market rates for free agents also impact his choices.

For the regular payroll calculation — 2012 income plus prorated shares of signing bonuses — spending by the 30 big league teams broke $3 billion for the first time at $3.15 billion after falling $43,000 short of the milestone last year.

The Yankees finished at a record $223.3 million, their 14th consecutive year as the biggest spender and topping their previous mark of $222.5 million in 2008.

However, the Dodgers could break that mark next year following a summer and autumn of acquisitions. Los Angeles currently is at $207.9 million for 21 signed players, including adjustments for the August trade with Boston that brought Adrian Gonzalez, Carl Crawford and Josh Beckett to the Dodgers. The Yankees are at $182 million for 14 players, including a deal with Ichiro Suzuki that hasn't been finalized.

"You don't get a trophy for having the highest payroll," Cashman said. "I'm not going to feel weird either way, if we're the highest or we're not the highest. That's not the issue. Just want to be the best."

Philadelphia was second at $169.7 million, followed by Boston ($168.6 million), the Angels ($160.1 million), AL champion Detroit ($140.7 million) and World Series champion San Francisco ($138.1 million).

Even while shedding some stars during the season, Miami rose from $61.9 million to $89.9 million. The Marlins figure to drop to the bottom of spending next year after trading nearly all their veterans.

Among the big slashers were the New York Mets (from $142.2 million in 2011 to $103.7 million) and the Chicago Cubs (from $140.6 million to $107.7 million).

Oakland won the AL West despite the lowest payroll in the major leagues at $59.5 million. The division rival Angels rose from $143.1 million to $160.1 million yet still missed the playoffs. They added slugger Josh Hamilton this week with a $125 million, five-year deal set to be announced Saturday.

The Dodgers, sold during the season to a group headed by Mark Walter, Stan Kasten and Magic Johnson, climbed from $109.9 million in 2011 to $129.1 million. In the last week they added pitchers Zack Greinke ($147 million over six years) and Ryu Hyun-jin ($36 million over six years).

The commissioner's office computed the average salary at a record 3,104,563, up 2.2 percent from last year's $3,039,161, The players' association, which uses a slightly different method, pegged the average at $3,213,479, up 3.8 percent.

Payroll figures are for 40-man rosters and include salaries and prorated shares of signing bonuses, earned incentive bonuses, non-cash compensation, buyouts of unexercised options and cash transactions, such as money included in trades. In some cases, parts of salaries that are deferred are discounted to reflect present-day values.

According to the collective bargaining agreement, checks to pay the luxury tax must be sent to the commissioner's office by Jan. 21.

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One Direction, Rihanna, Adele lead Billboard 2012 charts

LOS ANGELES (Reuters) – Newcomer British boy band One Direction joined R&B diva Rihanna and British singer Adele to top Billboard‘s year-end music charts, released on Friday.

One Direction, who topped the Billboard 200 album chart twice this year with their debut, “Up All Night” in March and their sophomore album “Take Me Home” in November, were named Billboard‘s top new artist/group, rounding off a stellar year of U.S. success for the band.

Adele, 24, who became the first woman top score No. 1 single, album and artist on Billboard’s 2011 year-end charts, continued her reign in 2012, when her Grammy-winning record “21″ was the top-selling album in the U.S. and she was once again named artist of the year.

“21″ has sold more than 10 million copies in the U.S. since its release in February 2011, becoming a fixture on the Billboard 200, especially after Adele’s six wins at the Grammy Awards earlier this year.

She is the only act to be named both top artist and have the top album in Billboard’s charts for two years in a row.

Adele was also named the No. 1 female artist while R&B rapper-singer Drake was named No. 1 male artist and pop-rock band Maroon 5 were named No. 1 group.

Rihanna, also 24, was named the top Hot 100 artist after a year of chart-topping hit singles such as “We Found Love” and “Diamonds” on the Hot 100 chart, which measures top-selling singles each week.

But Australia’s Gotye picked up the Hot 100 single of the year, with his heartbreak hit “Somebody That I Used To Know.”

Billboard compile their end-of-year lists based on chart performances between December 3 2011 and November 24 2012, tallying data including album sales and streaming figures.

For more on Billboard’s year-end charts, visit http://www.billboard.com/news/the-best-of-2012-the-year-in-music-1008045682.story#

(Reporting By Piya Sinha-Roy, editing by Jill Serjeant and Andrew Hay)

Music News Headlines – Yahoo! News

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Fewer health care options for illegal immigrants

ALAMO, Texas (AP) — For years, Sonia Limas would drag her daughters to the emergency room whenever they fell sick. As an illegal immigrant, she had no health insurance, and the only place she knew to seek treatment was the hospital — the most expensive setting for those covering the cost.

The family's options improved somewhat a decade ago with the expansion of community health clinics, which offered free or low-cost care with help from the federal government. But President Barack Obama's health care overhaul threatens to roll back some of those services if clinics and hospitals are overwhelmed with newly insured patients and can't afford to care for as many poor families.

To be clear, Obama's law was never intended to help Limas and an estimated 11 million illegal immigrants like her. Instead, it envisions that 32 million uninsured Americans will get access to coverage by 2019. Because that should mean fewer uninsured patients showing up at hospitals, the Obama program slashed the federal reimbursement for uncompensated care.

But in states with large illegal immigrant populations, the math may not work, especially if lawmakers don't expand Medicaid, the joint state-federal health program for the poor and disabled.

When the reform has been fully implemented, illegal immigrants will make up the nation's second-largest population of uninsured, or about 25 percent. The only larger group will be people who qualify for insurance but fail to enroll, according to a 2012 study by the Washington-based Urban Institute.

And since about two-thirds of illegal immigrants live in just eight states, those areas will have a disproportionate share of the uninsured to care for.

In communities "where the number of undocumented immigrants is greatest, the strain has reached the breaking point," Rich Umbdenstock, president of the American Hospital Association, wrote last year in a letter to Obama, asking him to keep in mind the uncompensated care hospitals gave to that group. "In response, many hospitals have had to curtail services, delay implementing services, or close beds."

The federal government has offered to expand Medicaid, but states must decide whether to take the deal. And in some of those eight states — including Texas, Florida and New Jersey — hospitals are scrambling to determine whether they will still have enough money to treat the remaining uninsured.

Without a Medicaid expansion, the influx of new patients and the looming cuts in federal funding could inflict "a double whammy" in Texas, said David Lopez, CEO of the Harris Health System in Houston, which spends 10 to 15 percent of its $1.2 billion annual budget to care for illegal immigrants.

Realistically, taxpayers are already paying for some of the treatment provided to illegal immigrants because hospitals are required by law to stabilize and treat any patients that arrive in an emergency room, regardless of their ability to pay. The money to cover the costs typically comes from federal, state and local taxes.

A solid accounting of money spent treating illegal immigrants is elusive because most hospitals do not ask for immigration status. But some states have tried.

California, which is home to the nation's largest population of illegal immigrants, spent an estimated $1.2 billion last year through Medicaid to care for 822,500 illegal immigrants.

The New Jersey Hospital Association in 2010 estimated that it cost between $600 million and $650 million annually to treat 550,000 illegal immigrants.

And in Texas, a 2010 analysis by the Health and Human Services Commission found that the agency had provided $96 million in benefits to illegal immigrants, up from $81 million two years earlier. The state's public hospital districts spent an additional $717 million in uncompensated care to treat that population.

If large states such as Florida and Texas make good on their intention to forgo federal money to expand Medicaid, the decision "basically eviscerates" the effects of the health care overhaul in those areas because of "who lives there and what they're eligible for," said Lisa Clemans-Cope, a senior researcher at the Urban Institute.

Seeking to curb expenses, hospitals might change what qualifies as an emergency or cap the number of uninsured patients they treat. And although it's believed states with the most illegal immigrants will face a smaller cut, they will still lose money.

The potential impacts of reform are a hot topic at MD Anderson Cancer Center in Houston. In addition to offering its own charity care, some MD Anderson oncologists volunteer at a county-funded clinic at Lyndon B. Johnson General Hospital that largely treats the uninsured.

"In a sense we've been in the worst-case scenario in Texas for a long time," said Lewis Foxhall, MD Anderson's vice president of health policy in Houston. "The large number of uninsured and the large low-income population creates a very difficult problem for us."

Community clinics are a key part of the reform plan and were supposed to take up some of the slack for hospitals. Clinics received $11 billion in new funding over five years so they could expand to help care for a swell of newly insured who might otherwise overwhelm doctors' offices. But in the first year, $600 million was cut from the centers' usual allocation, leaving many to use the money to fill gaps rather than expand.

There is concern that clinics could themselves be inundated with newly insured patients, forcing many illegal immigrants back to emergency rooms.

Limas, 44, moved to the border town of Alamo 13 years ago with her husband and three daughters. Now single, she supports the family by teaching a citizenship class in Spanish at the local community center and selling cookies and cakes she whips up in her trailer. Soon, she hopes to seek a work permit of her own.

For now, the clinic helps with basic health care needs. If necessary, Limas will return to the emergency room, where the attendants help her fill out paperwork to ensure the government covers the bills she cannot afford.

"They always attended to me," she said, "even though it's slow."

___

Sherman can be followed on Twitter at https://twitter.com/chrisshermanAP .

Plushnick-Masti can be followed on Twitter at https://twitter.com/RamitMastiAP .

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School shooting postpones Cruise premiere in Pa.

NEW YORK (AP) — The U.S. premiere of the Tom Cruise action movie "Jack Reacher" is being postponed following the deadly Connecticut school shooting.

Paramount Pictures says "out of honor and respect for the families of the victims" the premiere won't take place Saturday in Pittsburgh, where "Jack Reacher" was filmed.

The premiere would've been Cruise's first U.S. media appearance since his split from Katie Holmes over the summer. It was to be more contained with select outlets covering and a location away from Hollywood or New York.

A proclamation ceremony for Cruise had been planned with Pennsylvania Gov. Tom Corbett and Pittsburgh Mayor Luke Ravenstahl.

No new date for the premiere has been set. The movie opens Dec. 21.

Friday's massacre at a Newtown, Conn., elementary school killed 20 children and several adults.

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3 innovations from Chicago science scene

Julian Gordon and Prasanthi Gandhi pose for a photograph amid various air-purifying devices in their lab at Inspirotec, 2201 W. Campbell Park Dr., Wednesday, Dec. 12, 2012, in Chicago. The duo created the company that plans to develop and market an all-in-one air collector-detector, which will allow consumers to find out what allergens and pathogens might be in the air around them. (John J. Kim / December 14, 2012)

By Melissa Harris

11:15 p.m. CST, December 14, 2012

Internet-centered technology has advanced to the point that smartphone apps and e-commerce sites seemingly sprout overnight. Indeed, many can be built inexpensively from off-the-shelf software in weeks. Scientific breakthroughs, however, often require decades of research and millions of dollars. At the end of every year, I feature three teams of Chicago innovators whose ideas won’t hit the big-time soon but have the potential to improve, even save, our lives a decade from now.

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Alvarez fires back at '60 Minutes'

After days of scathing reviews of her "60 Minutes" interview on false confessions, Cook County State's Attorney Anita Alvarez fired off a letter to the venerable news program calling its Sunday report "one-sided and extremely misleading" and vowing to set the record straight.

The segment titled "Chicago: The False Confession Capital" featured two infamous Chicago-area cases in which teenage boys allegedly confessed to brutal murders but were later exonerated when DNA excluded them as the killers.

In her letter, addressed to CBS News Chairman Jeff Fager, Alvarez called the story "an offensive display" and accused reporter Byron Pitts of using only snippets of a 6-month-old interview to distort her record and make it appear she was still trying to prosecute the cases.

"Had I known that this story would completely distort my position and intentionally omit critical facts, I would never have agreed to your interview," Alvarez wrote.

One particularly damaging portion of the interview involved the Dixmoor Five case in which five men were convicted as teens of the 1991 rape and murder of a 14-year-old girl whose body was found on a path. DNA linked a serial rapist to the crime and undermined confessions from the teens. They were cleared in 2011 after spending years in prison.

Alvarez explained in the interview that one possible explanation for the DNA was necrophilia — that the rapist had sex with the girl after she'd already been killed.

That answer — which was roundly mocked in blogs and news critiques — was misconstrued, Alvarez said in the letter. She wrote that the necrophilia theory was used at trial years before she had any involvement in the case.

"I have never advanced that theory or argument, but simply responded, when asked by Mr. Pitts, that we can't say with certainty what had occurred," Alvarez wrote. "This story was not designed to inform, it was designed to undermine me and mislead the public."

Sally Daly, a spokeswoman for Alvarez, said the reaction to the piece has been vitriolic. "She's gotten hate mail, things you couldn't even publish," Daly said.

CBS News representatives did not return phone calls seeking comment.

jmeisner@tribune.com

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Exclusive: Softbank caps Sprint's Clearwire bid; investors want more

NEW YORK (Reuters) - Sprint Nextel Corp's $2.1 billion offer to buy out Clearwire Corp appeared to be running into trouble on Thursday, as some shareholders said they wanted more money while Softbank Corp set a cap on how much Sprint could pay.

Sprint, which owns 50.45 percent of Clearwire, offered $2.90 per share for the rest of the company and said it would also provide interim financing of $800 million to the cash-strapped company. Any deal would need approval by Softbank, which has agreed to buy 70 percent of Sprint for about $20 billion.

Clearwire shareholders, who together hold about 7.6 percent of the company, criticized the Sprint offer on Thursday, with some saying that the No. 3 U.S. wireless carrier should raise its bid to at least $5 per share. Holders of at least 24.8 percent of Clearwire's outstanding stock, other than Sprint, need to approve the deal.

Clearwire, which is reviewing the Sprint offer, saw its shares jump almost 15 percent on Thursday to $3.16, suggesting investors expected a higher price.

But Softbank has told Sprint that it would not consent to any Clearwire bid higher than $2.97 per share, two sources close to the matter said. The threshold is the same price that Sprint recently paid to buy a small stake from Clearwire founder Craig McCaw's Eagle River Holdings LLC.

Sprint, Clearwire and Softbank declined to comment on the details of these discussions.

For Clearwire, the deal is one of the few options it might have to survive in the long term. The company needs to raise more financing to upgrade its network and to keep the business afloat. It has said that it has enough money to last it until the third quarter.

Stabilizing Clearwire is also in Sprint's interest, which not only has a majority ownership of the company. The hurdles Sprint is running into highlight the complexities it faces in trying to take on its larger rivals, Verizon Wireless and AT&T Inc. A deal would also bolster Sprint's network and give the carrier full control of Clearwire's substantial spectrum.

The timing of Sprint's current negotiations with Clearwire is being driven by Clearwire's uncertain liquidity position, said the sources who asked not to be named because the discussions are private.

A third source close to the situation said Clearwire is also in talks about other strategic alternatives besides the Sprint offer. The person did not give details about what those alternatives were.

INVESTORS GRIPE, SOFTBANK SETS CAP

Several Clearwire shareholders on Thursday said they were dissatisfied with Sprint's offer.

Crest Financial, which owns more than 3 percent, said it "intends to take whatever actions it can" to protect Clearwire shareholders against "unfair dealing by Sprint and other parties."

Even before the Sprint offer was formally announced, Crest had filed a lawsuit on Tuesday against Clearwire and Sprint to try to thwart a deal after reports emerged about discussions between the companies.

Another shareholder, who declined to be named, told Reuters in an interview that an offer in the $5 per share to $8 per share range would be more acceptable to investors.

"This deal should happen. It's good for Clearwire. It's good for Sprint. $2.90 is not the right price," said the person who asked not to be named due to a lack of authorization to talk in public about investments.

Chris Gleason, a managing partner of Taran Asset Management, said "$5 to $7 is a fair range."

"You're at $5.30 before you start being real," said Taran, who owns about 3 million Clearwire shares.

But Softbank, which holds the key to the deal, is not willing to go that high, according to the sources.

Softbank founder Masayoshi Son's $2.97 per share threshold for the bid comes as Clearwire's shares have risen over the past couple of months on investor expectation of the deal.

The Eagle River purchase represented roughly a 130 percent premium to where Clearwire's stock had been trading before news of Softbank's deal with Sprint.

Moreover, if Sprint were to pay any other shareholder a higher price than the Eagle River deal, it would have to increase its payments to Eagle River to match the higher price.

The final outcome of the deal, however, remains unclear.

Clearwire's other minority shareholders include Intel Corp and Comcast Corp, which own about 12.4 percent between them.

Sprint has been in discussions with those companies about purchasing their shares, sources have said previously.

Intel said on Thursday that it was evaluating Sprint's offer, while Comcast declined to comment.

Analysts said Clearwire could also afford to hold out for a higher price.

"With a year of liquidity on the books and the alternative of raising additional equity or refinancing debt at this level, Clearwire is hardly without options, and we don't see why the company would necessarily jump at the $2.90 bid," JPMorgan analyst Philip Cusick said in a research note.

Pacific Crest analyst Michael Bowen said he believes that Sprint "should not pay more than $3" per share for Clearwire, but he added that the company may be pressured into eventually increasing its offer to $3.50 per share.

(Reporting by Nadia Damouni and Sinead Carew; Editing by Ken Wills and Paritosh Bansal)

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