Craig McCaw resigns as Clearwire chairman
- Wireless pioneer Craig McCaw has resigned as chairman of Clearwire Corp days ahead of a deadline on critical financial decision by its majority shareholder, Sprint Nextel.
Clearwire gave no reason for McCaw's departure but said it was not due to any disagreements with the company on any matters relating to its operations, policies, or practices.
The departure comes as Clearwire, which sells high speed wireless access, faces a cash crunch as it needs billions of dollars to finish building a national network.
McCaw nominated former Clearwire Chief Executive Ben Wolff to replace him on the board. Wolff, a trusted right hand man to McCaw, is widely seen on Wall Street as McCaw's chief negotiator through McCaw's Eagle River Holders investment vehicle, which owns a 4 percent of Clearwire.
He's there to watch the investment. If Eagle River needs somebody at the table they'd want Wolf in there; he's a pit bull, said Patrick Comack, Zachary Investment Research analyst.
Sprint is expected to consider increasing its control of Clearwire and would need to negotiate with fellow stake holders like Eagle River to achieve that aim.
Sprint has said it has no immediate plans to take full control of the company, in which it already has a 54 percent economic interest.
The issue is Eagle River are going to require an ample payment for their stock and whatever they get the public shareholders are bound to get, said Walter Piecyk, analyst at BTIG.
Analysts said a key financial issue for Clearwire will be the January 2 deadline for Sprint to decide whether to buy $760 million of Clearwire's convertible debt.
The success of Clearwire is crucial to Sprint, which rents space on the Clearwire network for its own high-speed offerings.
But relations between Sprint and Clearwire have been less than harmonious in recent times due to disagreements over how much money Sprint owes Clearwire for its network services.
For its part Sprint has objected to Clearwire's pursuit of a direct retail strategy, which essentially puts it into competition with its majority owner.
Other Clearwire investors include Comcast Corp, Time Warner Cable, Google Inc and Intel Corp.
Clearwire needs billions of dollars more funding to complete construction of its high-speed wireless network even after a $1.3 billion debt offering in December.
Clearwire faces fierce competition from market leader Verizon Wireless, which launched a rival high-speed wireless service in December, and MetroPCS, a regional rival that has started offering high-speed services in some markets.
AT&T Inc, the No. 2 U.S. mobile provider, has announced plans to upgrade its network later next year.
Verizon Wireless is a venture of Verizon Communications and Vodafone Group Plc.
(Reporting by Yinka Adegoke and Sinead Carew in New York, and Sakthi Prasad in Bangalore; Editing by Anshuman Daga and Steve Orlofsky)
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