Shares of the WiMAX company founded by Craig McCaw gave back early gains in their first day of public trading
After much hype ahead of its initial public offering, Clearwire (CLWR) gained value early but then lost its gains in its first day of public trading March 8. The Kirkland, (Wash.) company raised $600 million and priced shares at the high end of expectations in spite of a jittery market.
Market players had buzzed about Craig O. McCaw's company, which was founded in 2003 and provides a new version of wireless high-speed Internet service known as WiMAX. McCaw is a veteran at building companies; more than a decade ago he stitched together the first nationwide cellular empire, and then sold it to AT&T (T) for $11.5 billion in 1994.
McCaw is hoping to re-create such successes with Clearwire, which has amassed the second-largest chunk of the airwaves best suited to WiMAX services after Sprint Nextel (S) (see BusinessWeek.com, 3/5/07, "Clearwire: Taking WiMAX to the Street"). He holds around a 49% voting stake in the company post-IPO.
The company ended up pricing 24,000,000 shares of its Class A common stock on March 7 at $25.00 per share. The proposed range had been for $23 to $25 per share, according to Renaissance Capital's IPOhome.com. "Clearwire represents by far the largest tech-related IPO of 2007," the website said in a research note.
After the IPO Clearwire's stock climbed as high as $27.95 per share on Mar. 8 -- but the stock fell back to $24.62 per share at the close of trading.
The IPO comes as investors ponder the recent volatility in global equity markets. A 9% stock market sell-off in China on Feb. 27 prompted sharp drops almost everywhere else around the globe (see BusinessWeek, 3/12/07, "What The Market Is Telling Us").
But stocks were broadly higher in heavy mid-afternoon trading March 7, amid a global rally that began in Asia on a growing view world economies will be firm throughout the year (see BusinessWeek.com, 3/8/07, "Stocks Rise as Global Markets Rally").
Regardless of the market's direction, Clearwire has its grubstake. The company intends to use the proceeds to build out its network and acquire spectrum, among othjer things.