Clearwire Raises $1.5B in Capital
by Mike Farrell -- Multichannel News, 11/16/2009 2:00:00 AM
Investors in the Clearwire wireless-data consortium have agreed to pony up an additional $1.5 billion in capital to fund the expansion of its national WiMax network.
According to a statement, Sprint Nextel will contribute $1.2 billion; Comcast, $196 million; Time Warner Cable, $103 million; Intel, $50 million; Clearwire founder Eagle River Holdings, $20 million; and Bright House Networks, $19 million. In return, the partners will receive newly issued shares of Clearwire valued at $7.33 each. Absent from the latest round was Internet giant Google, which had contributed about $500 million in funding when the consortium was created last year.
Clearwire had been rumored to need additional funding for weeks. Clearwire shares rose to $7.25 each (up 45 cents per share) on Nov. 10, the day the deal was announced, but fell back sharply (15% or $1.11 per share) to $6.14 each the next day. That was most likely a reaction to its third-quarter financial results released late last Tuesday; net losses grew 13% to $82.4 million, while revenue rose 14% to $68.8 million.
Separately, Clearwire announced that it will launch a separate offering of senior notes for $1.45 billion to pay off its existing credit facility and will launch a common stock rights offering to existing shareholders.
“This additional level of strategic funding … will enable us to maintain our leadership and aggressive 4G WiMax network build plans,” Clearwire CEO Bill Morrow said.
Clearwire announced the consortium last year, with partners contributing $3.2 billion to fund a national WiMax network. It has launched in about 24 markets, including Portland, Ore., Atlanta and Philadelphia.
Clearwire Gets Shareholder Approval
11/19/2008Cable May Get WiMAX Option
08/12/2006Clearwire Shakes Up Management Team
05/14/2009
