US tech giant Google is planning to sell its shares in US WiMAX provider Clearwire, according to a Clearwire SEC filing.
Google said that it intends to sell up to 29,411,765 shares of Clearwire’s class A common stock, representing 6.5% of that class…
US tech giant Google is planning to sell its shares in US WiMAX provider Clearwire, according to a Clearwire SEC filing.
Google said that it intends to sell up to 29,411,765 shares of Clearwire’s class A common stock, representing 6.5% of that class of shares, for US$1.60 a share. If all shares were sold for this amount, the total value of the transaction would be approximately US$47m.
Clearwire’s share price on the NASDAQ closed yesterday, before the news emerged, at US$2.265. Google originally made an investment of US$500m in Clearwire in 2008.
Sprint holds a majority stake in Clearwire. Other shareholders include Bright House Networks, Comcast, Eagle River Holdings, Time Warner Cable, and the former chairman Craig McCaw.
According to the SEC filing, other investors in Clearwire have the first opportunity to acquire the shares.
If they choose not to acquire the shares, those will be sold in one or more public open market transactions on the NASDAQ.
The Clearwire filing stated: “Google periodically rebalances its investments based on its goals and its evaluation of market conditions.”
No further reasons for the sale were mentioned.
In its annual report, released on 16 February, Clearwire had said that it would need to raise “substantial additional capital” in order to fund its business and meet financial obligations beyond next year.
The WiMAX provider noted that the amount it needed to raise would depend on several factors, particularly the amount that Sprint pays it for services.
Credit Suisse analyst Jonathan Chaplin estimated that Clearwire requires US$2bn in additional capital and argued that the company could raise most, if not all, of this amount through asset sales and vendor financing.
In its report, Clearwire said that it had available cash and short-term investments of US$1.1bn as of 31 December 2011. But the company made a net loss of US$236.8m in Q4 2011.
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