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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes – just in case they're material to our investing thesis.
So what: Clearwire, a company in partnership and majority owned by Sprint Nextel (NYSE: S ) , had been actively seeking funding before the end of the year in order to continue expanding its wireless network. This funding will take some near-term pressure off of both companies and allow Clearwire to move forward with its plans to challenge Verizon (NYSE: VZ ) and AT&T (NYSE: T ) on a national level.
Now what: This debt offering hardly does anything to quell investor fears about Clearwire's ability to move forward. Most Wall Street analysts were looking for a considerably larger amount of financing than $1.1 billion, and it remains to be seen if this will be close to enough to finance the wireless network expansion. I do know this: Clearwire has yet to produce a profit and now finds itself considerably more debt- burdened than it was yesterday. That looks like a long-term recipe for disaster.
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