Google has filed documents with the SEC today in preparation for the sale of its entire stake in the troubled Clearwire Corporation. Having spent $500 million to acquire a 6.5 percent share back in 2008, Google is now cutting its losses and looking to sell up for approximately $47 million. The proposed $1.60 price per share dramatically undercuts the current $2.27 level, and Google's move will undoubtedly put even more pressure on the already financially constrained company. Clearwire's wireless broadband business was built on the premise that WiMAX will prosper and flourish in the US, but that forecast failed to materialize and now every major carrier — including Sprint, Clearwire's largest shareholder — is in the process of transitioning to LTE.
The SEC documentation explains Google's exit from Clearwire as an act of rebalancing its portfolio of investments, but a more candid assessment would be that Google expects Clearwire to sink beneath its mountain of debt and is getting out while it can. Sales of Google's shares in Clearwire will begin on February 27th, with the other equity holders getting first dibs, and should close by the end of March.