Clearwire Bumps Up Shares in IPO Pricing

Clearwire (CLWR) is going to debut today in what is expected to be the biggest IPO so far this year.  Clearwire is Craig McCaw’s WiMAX play that has garnered more coverage than most IPO’s.  The company bumped up its 20 million share offering to 24 million shares and the $25.00 pricing was at the top of the $23.00 to $25.00 range.

The underwriting was led by Merrill Lynch & Co., Morgan Stanley and J.P. Morgan Securities, Inc. as bookrunners. Wachovia Capital Markets, LLC, Bear Stearns & Co. Inc., Citigroup Global Markets Inc., Jeffries & Company, Inc., Raymond James & Associates, Inc., Think Equity Partners LLC and Stifel, Nicolaus & Company Incorporated are acting as co-managers.

This is one we and many others have covered extensively.  We had noted that it was likely to either see a higher price, or a bump up in the shares, or both.  So the pricing was at the top of the range, but the shares were raised by 20%.  Keep in mind that teh company has already disclosed that it will need to raised additional capital in the markets in the near future to continue its build-outs.

Underwriters have a 3.6 million share overallotment instead of the 3 million shares originally indicated, and it is a safe bet to assume that the company will be ‘overallotting’ those.  Here was Cramer’s original IPO playbook on it.  We’ll see how high this one opens, but the weak market may be what kept the pricing from getting much higher.

Jon C. Ogg
March 8, 2007