You know, given the prevailing gloom and doom scenarios offered by so many financial and tech analysts for Clearwire’s future, I would have expected the company to have to work their asses off to raise just $1B at a time like this. But the same street which has so many doubts is practically throwing money at these guys. Yesterday they just raised another $920M. So how much does that make now?
| + $1.564B | in new stock to Sprint, Comcast & crew |
| + $1.85B | increased from $1.45B in senior debt due 2015 priced today at 12% |
| + $920M | more of the same senior debt today, at 0.979 on the dollar. |
|
|
|
| = $4.3B | in new capital |
| – $1.4B | repaid credit facility |
| – <$0.1B | fees and discounts |
|
|
|
| >= $2.8B | additional cash available to spend |
So what does this mean? It means that if nothing else, the great WiMAX buildout extravaganza will go on without interruption for quite some time yet. Now all they need is subscribers, a million or so of them ought to crack open the door a bit…
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Categories: Financials · Wireless
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this is an impressive show of ‘access to captial’ for a business that is growth stage and solidly not profitable… good for them. probably bad for some others…
bad for others… as in sucking all the oxygen of the room?
most broadband providers (clec, cable mso, cell/LTE etc) trade at a multiple of EBITDA, and not such an impressive multiple at that — e.g., at&t and comcast trade for approx 5.5x). So, if an unprofitable upstart has this sort of access to capital and the incumbents are tied to rear looking ebitda metrics, it is safe to assume that the upstart has more flexibility to gain share, etc. like building a home, it is often easier to start over than it is to pull off a total rehab (while living through it…).
Maybe…just maybe the senior management and investors in these companies actually KNOW what the hell they are doing. Media, analysts and bloggers (sorry Rob) need a little humbling from time to time.
Wireless Broadband is a huge step in the data evolutionary cycle. Wimax, LTE, who the hell cares… What matters is that very few will be able to offer it due to the limited spectrum real estate.
Hey, I’m on Clearwire’s side. I just find it a bit ironic that the same people saying they have no chance seem quite willing to lend them so much money!
As for humbling me, I do try not to take myself too seriously on this site.
Rob, just poking fun… you do an excellent job with this site. It’s really a breath of fresh air from a lot of the muck out there… keep up the good work.