Jump to content

The cost to buyout Clearwire?


ericdabbs
 Share

Recommended Posts

Alright you financial gurus out there, I don't know if many of you guys have been paying attention to Clearwire's stock price (ticker: CLWR) but it is quickly heading to $1 (currently trading at $1.11).

 

If Sprint were to buy out Clearwire if it falls to $1, how much would it have to pay to buyout the remaining 46% stake in Clearwire? Ideally I want to see Clearwire survive on its own for a couple more years until Sprint can lock up some more PCS spectrum (ex: PCS H block) and Sprint's balance sheet to improve until it bought them out. I am curious to find out what Sprint is going to do if Clearwire gets near delisting status. Any financial gurus out there want to chime in on their thoughts?

Link to comment
Share on other sites

CLWR is worth alot than current price (4-5?). like to see CLWR get more LTE wholesale customers (Sprint & Leap for now). CLWR should offer wireless LTE internet too.

VZW going to kill their grandfathered unlimited data plan so u know VZW knows they don't have enough spectrum / capacity

faster the speed, the faster you use data. new LTE devices are data hogs!!!

 

Sprint keeps Unlimited Data, get more customers, & offload excess data off to CLWR LTE

 

moving from voice to data usage

Edited by alphnasx
Link to comment
Share on other sites

Well, Clearwire has a market cap at around $559M, so 46% of that is around $257M. If Sprint actually tried to buy Clearwire, they'd have to pay a premium price over the market cap, so maybe $400M. The problem is that if you buy Clearwire, you also assume Clearwire's debt, which is at least $4B (I didn't look at their detailed report). I don't think Sprint would be adversely affected if Clearwire gets delisted.

Link to comment
Share on other sites

Well' date=' Clearwire has a market cap at around 559M, so 46% of that is around 257M. If Sprint actually tried to buy Clearwire, they'd have to pay a premium price over the market cap, so maybe 400M. The problem is that if you buy Clearwire, you also assume Clearwire's debt, which is at least 4B (I didn't look at their detailed report). I don't think Sprint would be adversely affected if Clearwire gets delisted.[/quote']

 

How much of Clearwire's debt is from Sprint alone is the first question. You first subtract that. If Sprint had to do something, they could afford to absorb Clearwire. But I don't think that Clearwire will get delisted yet. They should rebound.

Link to comment
Share on other sites

I don't think Sprint should buyout Clearwire since they are trying to block the Verizon Wireless-SpectrumCo Deal. If that happens, Verizon will probably fire back at Sprint for trying to block their spectrum deal.

Link to comment
Share on other sites

I don't think that Sprint has been buying Clearwire debt lately.

 

It's not so much that Sprint has been buying Clearwire debt, as much as Clearwire has in the past held its debt payments over Sprint to get Sprint to give them more money. This is what occurred back on December 1st. If Sprint is de facto responsible for Clearwire's debt, because they cannot allow Clearwire to default, then it makes a lot of sense for Sprint to buy out Clearwire, if and when it has the funds to do it.

 

This was discussed in detail in a December article: http://s4gru.com/ind...lions-in-value/

 

Sprint is, in reality, servicing Clearwire's debt, for if Clearwire defaults, its spectrum goes to the creditors, and Sprint's entire 4G network goes with it. One of the primary benefits of the new agreement announced by Sprint and Clearwire on December 1 is that the Clearwire will make a $237 million debt payment, as scheduled. Clearwire's debt may not be on Sprint's balance sheet, but Sprint is still wholly responsible for it. We think that this is absurd, and are calling on Sprint to do what is necessary and acquire Clearwire outright.

 

Robert

Link to comment
Share on other sites

It's not so much that Sprint has been buying Clearwire debt, as much as Clearwire has in the past held its debt payments over Sprint to get Sprint to give them more money. This is what occurred back on December 1st. If Sprint is de facto responsible for Clearwire's debt, because they cannot allow Clearwire to default, then it makes a lot of sense for Sprint to buy out Clearwire, if and when it has the funds to do it.

 

This was discussed in detail in a December article: http://s4gru.com/ind...lions-in-value/

 

 

 

Robert

 

I think Sprint is praying like heck that somebody else buys Clearwire first and they get their money out of it. If they can get another 10-20Mhz of spectrum somewhere else, they would jump at the chance. They like PCS spectrum or near PCS spectrum. They might even settle for Dish spectrum. They don't like Clearwire period.

Link to comment
Share on other sites

I think Sprint is praying like heck that somebody else buys Clearwire first and they get their money out of it. If they can get another 10-20Mhz of spectrum somewhere else, they would jump at the chance. They like PCS spectrum or near PCS spectrum. They might even settle for Dish spectrum. They don't like Clearwire period.

 

T-Mobile should buyout Clearwire. Both companies are based in Bellevue, Washington. That should be an easy transition to move the Clearwire Employees to the T-Mobile Headquarters from the Clearwire Headquarters.

Link to comment
Share on other sites

I think Sprint is praying like heck that somebody else buys Clearwire first and they get their money out of it. If they can get another 10-20Mhz of spectrum somewhere else, they would jump at the chance. They like PCS spectrum or near PCS spectrum. They might even settle for Dish spectrum. They don't like Clearwire period.

 

Agreed. However, Sprint also knows that Clearwire is a definite, whereas PCS H Block or Dish spectrum are just possibilities. So they have to keep Clearwire in their back pocket for now. I would hold my nose and buy out Clearwire this year, if they can buy up remaining shares around a $1. It makes more sense than buying MetroPCS or Leap.

 

Robert

Link to comment
Share on other sites

T-Mobile should buyout Clearwire. Both companies are based in Bellevue, Washington. That should be an easy transition to move the Clearwire Employees to the T-Mobile Headquarters from the Clearwire Headquarters.

 

Sounds like a marriage made...in Purgatory. :lol:

 

Robert

Link to comment
Share on other sites

I think Sprint would rather eat up clearwire vs letting tmobile or another major competitor buy them out. I am sure sprint is just waiting for the right time to buy them out. I feel like the quarter after sprint becomes profitable, they swallow up clearwire.

  • Like 1
Link to comment
Share on other sites

 

Agreed. However' date=' Sprint also knows that Clearwire is a definite, whereas PCS H Block or Dish spectrum are just possibilities. So they have to keep Clearwire in their back pocket for now. I would hold my nose and buy out Clearwire this year, if they can buy up remaining shares around a 1. It makes more sense than buying MetroPCS or Leap.

 

Robert[/quote']

 

Sounds like a hostile takeover to me. I would be willing to sell out for more Sprint stock. How does the FCC handle hostile takeovers and wireless spectrum?

 

Sent from Joshs iPhone 3Gs using Forum Runner

Link to comment
Share on other sites

If sprint has its focus set on running a 38,000 tower network and getting its income statement positive, the only use that spectrum will ever be to them is additional capacity for spectrum strained markets. If sprint became owner of clearwire tomorrow, what would they do? Make plans to throw cards on towers in densely populated places on their nv towers and sit on the rest of it until they can start decommissioning sites. Then be more scrutinized because they have a plentiful supply of cost prohibitive spectrum the next time they try to get other spectrum. I agree that clear is a liability as long as they dont own it, but Im not sold on the idea of cash strapped sprint "outright" either. Just seems even more risky that what theyre doing now. Both need a sugar daddy! If money is scarce for buildout, clear isnt a great buy.

Link to comment
Share on other sites

Sprint will end up buying Clearwire in a few years to get access to all of that 2.5/2.6 GHz spectrum they could use to bolster their LTE

Link to comment
Share on other sites

Sprint will end up buying Clearwire in a few years to get access to all of that 2.5/2.6 GHz spectrum they could use to bolster their LTE

 

Unless they plan to offer HDTV with all that spectrum, it is a total waste and would be counted against them if they were to bid or buy other spectrum or other companies. They might need another 10-20MHz or so in densely populated NYC or San Fran, but not in too many other places. I would rather they bought out Metro or Cricket or both and do some swapping of AWS spectrum for PCS spectrum with the holders of AWS spectrum. However, I think they want to wait until they either return to profitability or their stock recovers or both, so that they can buy either/both for cheap.

Link to comment
Share on other sites

If sprint has its focus set on running a 38,000 tower network and getting its income statement positive, the only use that spectrum will ever be to them is additional capacity for spectrum strained markets. If sprint became owner of clearwire tomorrow, what would they do? Make plans to throw cards on towers in densely populated places on their nv towers and sit on the rest of it until they can start decommissioning sites. Then be more scrutinized because they have a plentiful supply of cost prohibitive spectrum the next time they try to get other spectrum. I agree that clear is a liability as long as they dont own it, but Im not sold on the idea of cash strapped sprint "outright" either. Just seems even more risky that what theyre doing now. Both need a sugar daddy! If money is scarce for buildout, clear isnt a great buy.

Would they need more spectrum? In the top 100 markets, Clearwire averages 150 by comparison Verizon averages 118 I believe. I believe it will be eons before they need to participate in a spectrum auction. Also they would not have to sit on it, They could start a home internet service with that spectrum. Plenty of people are stuck with slow speeds from their ISPs, and sprint could come in offer better speeds at a competitive price. Or sprint could focus on mobile devices, and offer better data prices compared to the other three, while offering faster speeds. Or a bundle of both, like clearwire does currently. Both of these plans would have more users jumping to sprint, which means the spectrum is making them money.

  • Like 1
Link to comment
Share on other sites

Would they need more spectrum? In the top 100 markets, Clearwire averages 150 by comparison Verizon averages 118 I believe. I believe it will be eons before they need to participate in a spectrum auction. Also they would not have to sit on it, They could start a home internet service with that spectrum. Plenty of people are stuck with slow speeds from their ISPs, and sprint could come in offer better speeds at a competitive price. Or sprint could focus on mobile devices, and offer better data prices compared to the other three, while offering faster speeds. Or a bundle of both, like clearwire does currently. Both of these plans would have more users jumping to sprint, which means the spectrum is making them money.

 

Clearwire does provide home internet service. The only problem is that Clearwire would need to expand its footprint tremendously in order to serve a huge amount of customers for internet. The problem is not whether Clearwire has enough spectrum to support home internet service but rather the funds needed to have a thorough buildout on 2.5 GHz spectrum which is costly.

Link to comment
Share on other sites

Clearwire does provide home internet service. The only problem is that Clearwire would need to expand its footprint tremendously in order to serve a huge amount of customers for internet. The problem is not whether Clearwire has enough spectrum to support home internet service but rather the funds needed to have a thorough buildout on 2.5 GHz spectrum which is costly.

I was talking about what Sprint could do with that spectrum, so it is not just sitting unused. Clearwire does not have the funds, but sprint would. Also Sprint would not need to make a nationwide 2.5ghz network.

Link to comment
Share on other sites

 

 

Unless they plan to offer HDTV with all that spectrum, it is a total waste and would be counted against them if they were to bid or buy other spectrum or other companies. They might need another 10-20MHz or so in densely populated NYC or San Fran, but not in too many other places. I would rather they bought out Metro or Cricket or both and do some swapping of AWS spectrum for PCS spectrum with the holders of AWS spectrum. However, I think they want to wait until they either return to profitability or their stock recovers or both, so that they can buy either/both for cheap.

I do not know how much you know about spectrum but there are advanatages and disadvanages to the different types of spectrum.

 

The 700 A band is plagued with interference from TV. The 700 A B and C bands are not truly one band but multiple bands that can not easily be used in the same phone. All 700, A B and C, though are great at having the signals travel but not that good a capacity

 

The AWS is one of those ands that is the best to build on because it consist of 1700/2100 bands that give capacity and also travel good deals. Personally this is the best spectrum

 

The PCS is on the 1900 band and is again a good band for wireless connections like the AWS spectrum

 

2.5/2.6 spectrum is personally better then any spectrum listed above besides AWS or PCS for cities like New York because it gives high capacity. A high capacity network old be able to support the large population. You may have to locate the towers close to each other, with in a 1 mile range I believe for a constant network.

 

The only band I did not mention above is the 800 band but I have little knowledge

Link to comment
Share on other sites

A hostile takeover of Clearwire would be impossible without also taking over Sprint, so I doubt DT wanting to get out of the U.S. market will end up expanding Tmobile and no way the FCC allows VZ or ATT to take them over. Regarding buildout costs, in urban areas it should cost no more than any other additional spectrum that Sprint would acquire with NV. In fact NV was originally planed to host clearwire spectrum.

Link to comment
Share on other sites

I do not know how much you know about spectrum but there are advanatages and disadvanages to the different types of spectrum.

 

The 700 A band is plagued with interference from TV. The 700 A B and C bands are not truly one band but multiple bands that can not easily be used in the same phone. All 700, A B and C, though are great at having the signals travel but not that good a capacity

 

The AWS is one of those ands that is the best to build on because it consist of 1700/2100 bands that give capacity and also travel good deals. Personally this is the best spectrum

 

The PCS is on the 1900 band and is again a good band for wireless connections like the AWS spectrum

 

2.5/2.6 spectrum is personally better then any spectrum listed above besides AWS or PCS for cities like New York because it gives high capacity. A high capacity network old be able to support the large population. You may have to locate the towers close to each other, with in a 1 mile range I believe for a constant network.

 

The only band I did not mention above is the 800 band but I have little knowledge

 

Oh, yes, I'm well aware of the advantages and disadvantages of each band of spectrum, particularly when it comes to MIMO and handset real-estate. I'm also aware of the tradeoffs between capacity and propagation. AWS is perfectly good spectrum, but I think Sprint wants to limit their LTE supported bands to 3: 800, 1900 and 2500MHz.

Link to comment
Share on other sites

I do not know how much you know about spectrum but there are advanatages and disadvanages to the different types of spectrum.

 

The 700 A band is plagued with interference from TV. The 700 A B and C bands are not truly one band but multiple bands that can not easily be used in the same phone. All 700, A B and C, though are great at having the signals travel but not that good a capacity

 

The AWS is one of those ands that is the best to build on because it consist of 1700/2100 bands that give capacity and also travel good deals. Personally this is the best spectrum

 

The PCS is on the 1900 band and is again a good band for wireless connections like the AWS spectrum

 

2.5/2.6 spectrum is personally better then any spectrum listed above besides AWS or PCS for cities like New York because it gives high capacity. A high capacity network old be able to support the large population. You may have to locate the towers close to each other, with in a 1 mile range I believe for a constant network.

 

The only band I did not mention above is the 800 band but I have little knowledge

 

The various bands do not have any capacity advantages over another considering the same amount of allocated spectrum. The advantage of the higher frequencies in a phone are the smaller antennas required allow for more to fit into a phone handling more bands.

Link to comment
Share on other sites

 

The various bands do not have any capacity advantages over another considering the same amount of allocated spectrum. The advantage of the higher frequencies in a phone are the smaller antennas required allow for more to fit into a phone handling more bands.

 

There is a difference in capacity. Every base station will allow a certain amount of users depending on the amount of spectrum allocated. The 700 mhz spectrum has a much larger coverage area per base station than higher frequencies. This can be mitigated with downtilt, but the higher frequencies allow higher capacity by default.

 

Sent from my Galaxy Nexus using Tapatalk 2

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

 Share

  • large.unreadcontent.png.6ef00db54e758d06

  • gallery_1_23_9202.png

  • Posts

    • The Kendall/Kerr/Gillespie PCS swap is a very nice win-win for AT&T and T-Mobile. Means both of them will have a 20x20 PCS channel, though in exchange T-Mobile goes from 10x10 to 5x5 on one of their spectrum blocks. I figure AT&T will start running n2 DSS on that channel, as they have enough customers in those areas to need the capacity, while T-Mobile will probably just run B2 LTE, as once Auction 108 finally clears they'll have plenty of n41 to play with. Guessing we'll see the non-G-block 5x5 slice running n25, but it would get aggregated with n71 rather than n41 I figure as n71 will remain 20x20 there until the STA goes away (and maybe after that, as if T-Mobile gets 700 MHz as the result of VZW buying West Central Wireless's spectrum there's no reason to run LTE in 600). Which makes me think that the next move is T-Mobile trading 700A for the 5x5 of orphaned PCS (E block) to VZW once the WCW transaction closes, as that would give VZW 20x20 PCS in the area, and would give T-Mobile 700 MHz in an area where they have none. Then VZW can either trade 700B to T-Mobile as well in exchange for the AWS I block in those areas (gives T-Mobile 10x10 B12, gives VZW 15x15 B66) or they can cut a deal with AT&T to give AT&T 10x10 B12 (AT&T has the lower C block), but I'm not sure what that deal would be if trading like for like (vs. AT&T handing VZW their upper tiny slice of B5, giving VZW 15x15 to play with in that band post-WCW-acquisition). EDIT: Just looked at AWS spectrum again, and if AT&T would rather have 10x10 B12 than 2x 10x10 AWS, they could swap AWS-D for VZW's 700B block. That would give VZW 20x20 AWS, and would take AT&T down to 10x10 + 5x5...which they'd likely be fine with as they have 20x20 PCS, small cells in the busy areas, and as a result of the transaction three 10x10 chunks of spectrum in the area below 1 GHz. And if VZW traded 700A to T-Mobile for PCS-E VZW would have 20x20 PCS as well. Which is quite useful in an area that's macro-only for VZW and likely not dense enough for proper mobile usage of CBRS or C-Band (and an area where VZW doesn't even run DSS now).
    • Yeah, $250 credit for an S22 is awful. tbf last year they didn't have solid upgrade credits until mid-late April, which is when I paid $225 to swap my S21 for an S22. Happy to wait 'til then for that kind of deal, though I'll be annoyed at battery life in the mean time.
    • Miserable upgrade credits from Samsung this year unless you want to rely on carrier financing. Sticking with S22U for a while. 
    • So far we've documented close to 100 Sprint conversions in NYC with permits still rolling in and that's only what we've identified manually. Tons of sites get converted/updated without permits so there's potentially a lot more that we haven't spotted yet. There are also dozens of sites that are still broadcasting the keep PLMN, some have been decommissioned but historically the vast majority have been converted.
  • Recently Browsing

    • No registered users viewing this page.
×
×
  • Create New...