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Clearwire Corporation (CLWRD) Message Board

  • invest2bfree invest2bfree Jun 13, 2012 3:19 PM Flag

    Sprint is selling Class A but buying back class B!

    This is confusing like hell-

    http://www.nasdaq.com/symbol/clwr/sec-filings

    Two filing one on May 29th.

    Other on June 11th.

    They contradict each other.

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    • While this doesn't directly answer your particular question, I believe this is an excellent summary of what CLWR's agenda for issuing the shelf offering. Credit goes to "Spokanimal"

      "Thank You, Saul, For the Clarity on Dilution
          13-Jun-12 01:34 pm    
      The past week has seen a flurry of speculation about Clearwire dilution in the wake of Sprint's re-assertion of voting rights. The speculation was that Sprint's "economic" ownership was pushed under 50% as a result of Clearwire's recent announcement of a "shelf" offering.

      Although I suspected that sprint's diminished economic interest had been due to the December stock issuance, and not the more recent shelf offering, I wasn't sure, because memory served that Sprint had participated in the December offering in proportion to their ownership interest at that time... and, quite frankly, I was too busy... and lazy... to check it out... mainly because I figured that they had indeed, undersubscribed to the december offering.

      Well, thank you, Saul, for confirming that assumption:

      http://wallstcheatsheet.com/stocks/is-sp...

      Let me lay it right out there and tell you why I made that assumption so confidently.

      You don't DO a shelf offering with the intention of issuing the stock on the spot... you do it because you forcast strategic reasons for issuing over a 2-year time frame, which is the legal time frame that applies to shelf offerings.

      Secondly, when your company's book value and liquidating value are many orders of magnitude higher than your market value, you don't issue stock unless you HAVE to. In december, they HAD to (at $2/share) because they had to have the LTE capital in hand to do the deal with sprint... sprint had to SEE the capital it would take to reach the 2 companies' joint goals.

      Finally, the REASON for the shelf offering is as plain as the noses on this board's collective faces. Clearwire is embarking on a construction project that ensures they will have the most competitive transmission protocol and network speed and capacity in the wireless world, mitigated only by the propagation inferiority of the 2.5ghz band. As that network begins to bear fruit, and wholesale prospects begin to talk turkey, that shelf offering represents dry powder that the company will need to take the next step if the stock should begin to reflect those prospects.

      As I've said, it could take many forms... be it a straight, public issuance; an award to a significant wholesale partner who wants to participate in any run-up associated with such a partnership, or even as incentive stock to acquire critical talent...

      ... but the point is that it's a "shelf" offering, and it's as clear as a sunny, cascade mountain day that a guy with Stanton's credentials isn't going to go out there "right now", and augment a $1.4 billion cash hoarde he won't need until autumn with a $300 million shelf offering when the stock is barely above a buck a share... and to think otherwise is lunacy."

      Spokanimal

    • One thing is for sure that the 300million dilution is nothing to do with what is happening.

 

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