Clearwire, a wireless broadband firm founded by billionaire Craig McCaw and backed by Intel and Motorola, breaks a lull in the market for initial public offerings with its $500 million debut expected Thursday.
Clearwire is the first of three high-profile IPOs this week along with Xinhua Finance and Sourcefire after a traditional late-winter quiet stretch in the market for new issues as debutantes tabulate their fourth-quarter results ahead of their market splashes.
Although the IPO market appears to be on steady footing after last week's global equities selloff, expectations for huge gains in the new-issues market have been pared back.
Clearwire plans to offer 20 million shares at $23 to $25 a share in a bid to raise about $480 million with 10 underwriters including Merrill Lynch, Morgan Stanley and J.P. Morgan. Shares will trading under the symbol CLWR on the Nasdaq.
Scott Sweet of IPO Boutique said it is likely the Clearwire IPO could price above its estimated range.
Clearwire marks a rare entry in the IPO market from the telecom sector, which has been mostly dormant in the years following post-2000 bear market.
The Kirkland, Wash.-based company first filed to go public in a $400 million IPO in May of 2006, but then scrapped the IPO in July of last year after drawing $900 million from Intel and Motorola in the richest venture payment ever, according to VentureOne.
The company re-filed its IPO in December and later reported a 2006 net loss of $284 million on revenue of $100 million, compared to a net loss of $140 million and revenue of $33 million in 2005.
Although the company has yet to turn a profit, Wall Street appears to be eager for a stake in Clearwire's position as owner of coveted airwaves spectrum and its role in strong growth expected in the emerging Wi-Max market.
"We believe that Clearwire's proposed offer price...appropriately balances the company's risk profile and growth potential, which could limit the stock's near-term upside potential," Renaissance Capital said in its IPO column.
McCaw is also a familiar name to Wall Street as the force behind McCaw Cellular, which he sold to AT&T Inc. (T) for $11.5 billion in 1993. AT&T then staged the richest U.S. IPO of all time with AT&T Wireless in 2000, with proceeds of $10.6 billion.
McCaw invested much of the profit from that deal into Nextel and a satellite network, only to suffer big losses in the telecom crash about six years ago.
Still, McCaw was ranked number 365 in the 2006 Forbes list of billionaires, with a net worth listed at $2.1 billion.
Clearwire faces competition from Sprint-Nextel, the largest holder of spectrum, which plans to deploy its Wi-Max network next year.
The four-year-old company, which describes itself as an early stage firm, rang up a cumulated loss of $458.6 million as of Dec. 31. It needs about $800 million in cash for 2007 and is likely to spend about $4 billion through 2013 to roll out its network.
Wi-Max, which stands for World Interoperability for Microwave Access, is seen as a competitor to broadband services offered by cable TV and telephone operators.
"As wireless broadband becomes widely available, we believe demand for a broad range of mobile applications will dramatically increase, including demand for email, Web browsing, VoIP (voice-over-Internet-protocol) telephony, streaming audio and video, video conferencing, gaming, e-commerce, music and video downloading and file transfers," Clearwire said in its IPO prospectus.
OncoGenex IPO Pulled
OncoGenex has been pulled off the calendar for its expected debut on Wednesday. The biotech firm had hoped to raise about $40 million after reducing its price to $7.50 to $8.50 a share from $10 to $12 a share.
The company had already been delayed from its expected debut last week.
Aruba Networks IPO Nears Debut
Aruba Networks on Wednesday said it plans to offer eight million shares at $8 to $10 a share in a bid to raise about $72 million in its upcoming initial public offering with underwriters Goldman Sachs and Lehman Brothers.
The Sunnyvale, Calif., maker of technology for secure access to data, voice and video applications across wireless and wireline networks plans to trade under the symbol ARUN on the Nasdaq.
Glu Mobile Sets $10 To $12 Price
Glu Mobile Inc. late Tuesday said it plans to offer 7.3 million shares at the estimated range of $10 to $12 a share in a bid to raise $80 million in its upcoming initial public offering.
The San Mateo, Calif.-based publisher of mobile games such as Deer Hunter, Diner Dash, Monopoly, Sonic the Hedgehog and World Series of Poker plans to trade on the Nasdaq under the symbol GLUU on the Nasdaq.
Goldman Sachs and Lehman Brothers are underwriting the deal.
Business-Development Firm Files IPO
BlackRock Kelso Capital Corp. late Tuesday filed its initial public offering to trade on the Nasdaq under the symbol BKCC. The business-development firm is managed by BlackRock Kelso Capital Advisors LLC.
BlackRock Financial Management Inc. (BLK) serves as its administrator. Underwriters on the deal include J.P. Morgan, Citigroup, Merrill Lynch and Wachovia Securities. The company invests in middle-market companies with revenue of $50 million to $1 billion and to provide an "attractive risk-adjusted return."
Starent Networks Files $115-Mln IPO
Starent Networks Corp. on Tuesday filed to raise up to $115 million in an initial public offering. Goldman Sachs and Lehman Brothers are the deal's lead underwriters.
The Tewksbury, Mass.-based provider of infrastructure solutions said it has applied to list its common shares on the Nasdaq Global Market under the ticker symbol "STAR."
-Steve Gelsi; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires"
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