Clearwire shares drop another 10 percent

SEATTLE – Shares of Clearwire Corp., a wireless-Internet provider founded by cell phone pioneer Craig McCaw, sank nearly 10 percent in their second day of public trading.

The Seattle billionaire’s latest venture landed with a thud on Wall Street after critics said his underwriters sold too many shares at too high a price.

The Kirkland-based company raised $600 million in an initial public offering Wednesday night. Shares closed below the IPO price Thursday and continued their descent Friday, falling $2.47, or 10 percent, to close at $22.15 on the Nasdaq Stock Market.

Just before the IPO, underwriters upped the number of shares to be sold to 24 million – significantly more than the 20 million described in the company’s prospectus – at $25 per share, the top of the estimated price range.

Clearwire’s fall was a sharp reversal of this year’s IPO trends. On the first day of public trading, shares have gained an average of 5 percent, according to Renaissance Capital’s Web site,

Clearwire, which counts Intel Corp. and Motorola Inc. among its investors, is rolling out a new generation of wireless technology known as WiMax, which offers DSL-comparable speeds and greater range than today’s Wi-Fi. The mobile flavor of WiMax – which most companies are focusing on – functions more like a cell-phone network than the wireless Internet that consumers currently use. Clearwire offers the service in about 45 markets, including Seattle; Raleigh, N.C.; and Waco, Texas.

In 2006, Clearwire posted a net loss of $284.2 million, following a 2005 loss of $140 million.

Clearwire’s Friday-afternoon share price values the company at about $3.6 billion, based on almost 162 million shares of Class A and Class B stock outstanding.

McCaw owns a nearly 49 percent voting stake and a 34 percent equity stake in the company after the sale. His shares are worth about $1.26 billion at Friday afternoon’s price.

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