Today’s comments from David Faber have rekindled interest, although the news is the same and we wonder how much higher Sprint can let this get before it announces a takeover. The might even be what is called a “takeunder” because Clearwire shares were trading down at $1.30 before the Sprint-Clearwire-Softbank news broke.
Clearwire is now up 10% at $2.45 and the consensus standalone value of Clearwire is only $2.20, according to Thomson Reuters consensus data. We already have seen a whopping 22 million shares trade hands, and that is after a massive 170 million shares traded hands on Thursday.
It is still too early in the trading day to give a clear projection of what options traders are valuing a Clearwire acquisition at yet. Stay tuned.
We worry about the consensus price target being under the trading price, although analysts may have a much higher implied buyout valuation versus a standalone operating valuation. As a reminder, the biggest issue is the $4+ billion in debt that Clearwire has. As a reminder, there is no assured limit as to what a buyer would pay, and a buyer may value this spectrum acquisition far higher than what analysts and options traders value the company.
JON C. OGG
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