NEW YORK (Reuters) - Shares in Clearwire Corp CLWR.O rose 5 percent on Wednesday after it priced $920 million in debt in addition to $1.85 billion debt it sold recently, reassuring investors that it has enough resources expand its high-speed WiMax network.
“That gives them a good cushion at least through 2010,” Pacific Crest analyst Steve Clement said. “It removes any doubt about them being able to meet their (network) build targets for next year.”
Clearwire, an upstart founded by wireless pioneer Craig McCaw, is under pressure to quickly build its network to compete with Verizon Wireless, a venture of Verizon Communications (VZ.N) and Vodafone Group Plc (VOD.L), and AT&T Inc (T.N).
Clement said Clearwire news may also have cheered up investors in Sprint Nextel (S.N), a 51 percent owner of Clearwire, as Sprint shares were up 2 percent at $3.84 on New York Stock Exchange on Wednesday.
“From a Sprint shareholder perspective, it’s positive Clearwire is getting the funding from the debt market and not Sprint,” Clement said.
The $920 million debt pricing was announced late on Tuesday after being reported by Reuters earlier that day.
It follows a November 10 announcement by the company that it had raised $1.56 billion funding from existing investors including Sprint Nextel, which contributed $1.176 billion.
Its shares rose 29 cents to $5.72 in morning trade on Nasdaq, after reaching as high as $5.97 at one point,
Reporting by Sinead Carew; Editing by Derek Caney