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Clearwire Corporation (CLWRD) Message Board

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  • ed_amamay ed_amamay Feb 2, 2013 8:01 AM Flag

    do some of you realize just how wrong you have been for FOUR YEARS?

    wrong. CLWR gets sold, absorbed or partners. Sprint goes away...slowly at first...then becomes a weak, prepaid player.

    I offer a 50% chance that the SB deal goes through ,as proposed. S balance sheet can't keep the boat afloat and Son does not want Sprint alone for 20B dollars.

    If Sprint/SB does not pass...the CLWR deal is a moot point. Sprints offer is far more "illusionary" than DISH's in the fact that Sprint is telling CLWR "we will buy you IF we get the SB deal complete"......i guess Hessee did not eat his veggies, ay?

    Sentiment: Strong Buy

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    • What you don’t quite get it is that only 40% of Clearwire spectrum is owned and the rest (60%) are leased (belonging to someone else) which means Clearwire has about 18B MHz-POP (46B MHZ-POP x 40%) that’s considered their asset which they can sell.

      As stated in Clearwire’s financial the leasing of 60% spectrum is currently costing Clearwire over $300M each year. If Clearwire goes into bankruptcy any leasing agreements are effectively nulled (voided) which means Clearwire ends up with about 60 MHz (or 18B MHz-POP) of their own. Given that Clearwire’s debt is at $4.3B and other liabilities (towers and other leases) amount to $1.2B Clearwire is on the hook for $5.5B even before shareholders’ settlement. Clearwire's $1B cash-on-hand will probably go to payroll, severance, and IRS.

      Let’s say will be generous and put a value of $0.40 /MHz/POP on 18B MHZ-POP (Clearwire’s spectrum asset) this gives a value of $7.2B. But, after paying off Clearwire’s liabilities there will only be $1.7B left or $1.13 /share. But, a $0.40 /MHz/POP will be highly unlikely and realistically it will be more like $0.25-$0.30 /MHz/POP (at most) which means shareholders will end up with $0.

      What is so striking is Clearwire management has explicitly stated that if Sprint’s deal goes sour Clearwire may face FINANCIAL RESTRUCTURING.

      • 3 Replies to sunnybeach73
      • Your calculations are all biased and skewed - read seeking alpha's "Can Sprint Acquire All Of Clearwire? December 16, 2012 ". Excerpt FYI: "The price of spectrum continues to grow as it has for the last so many years. Like real estate, it is a scarce resource and there is only a fixed amount of it available but unlike real estate, its value is not cyclic in nature. Even if we calculate on the basis of the same price ($0.68) that Verizon agreed to pay then to Spectrum Co, Clearwire's spectrum position of approximately 46 billion MHz-Pops gives it an enterprise value of more than $31 billion. That calculates as $30 per share. (In these calculations, I have received considerable help from SR Capital's excellent article)." Complete details of the calculations are found in the link from the last word in the excerpt i.e. "article". OK?, so now you can go and .... yourself.

        Sentiment: Strong Buy

      • So all the news reports are wrong when they say clwr owns 160mhz of spectrum??? I really would like to see your source for those figures, especially the 60% leased spectrum

      • Clearwire's press releases are being written by Sprint's PR department. Clearwire's official communications are holding to the Sprint party line. It is all propaganda. What really matters is what is going on behind the scenes. My money's with Crest, Mt. Kellett, the independent longs, and veggie ed_amamay.