By Abinaya Vijayaraghavan, Nayyar Rasheed and Sriraj Kalluvila

(Reuters) - Sprint Corp <S.N>, the No. 4 U.S. wireless carrier, said on Wednesday it planned to raise an initial $3.5 billion by mortgaging about 14 percent of its wireless airwaves.

The company, majority owned by Japan's SoftBank Group <9984.T>, estimates the airwaves are worth about $16.4 billion.

The spectrum portfolio, which includes FCC licenses and a small number of third-party leased license agreements, would be leased back, the company said.

The offering is expected to be rated investment grade by Moody's Investors Service and Fitch, Sprint said.

The carrier has been burning through cash as it faces intense competition for subscribers. The company had negative cash flow of $3.17 billion in the financial year ended March 31.

Sprint raised $1.2 billion in November and $2.2 billion in April through similar sale and lease-back deals.

Wall Street Journal first reported Sprint's plan on Tuesday. (http://on.wsj.com/2dbjNXQ)