Google this morning signaled its intent to sell its stake in Clearwire, the Bellevue-based wireless broadband company, seeking $1.60 a share for its up to 29.4 million shares of the company’s stock.

It’s a significant discount from Clearwire’s Thursday closing price of $2.26, but more notably, the potential return of $47 million represents a big loss for Google on its original $500 million investment in the company.

Clearwire shares are down about 6 percent this morning on the news.

The company originally made a huge investment in the 4G WiMAX technology only to see LTE become the preferred standard among the major wireless carriers. A week ago, Clearwire told its investors that it will need to raise more cash to keep its business afloat over the long term as it transitions to LTE.

Google gave no specific reason for the decision, saying in a regulatory filing that it “periodically rebalances its investments based on its goals and its evaluation of market conditions.” Intel Capital reduced its stake in Clearwire last year, but remains an owner.

Other investors in Clearwire include Sprint, Comcast and Time Warner Cable. Those large investors will have an opportunity to buy Google’s shares before the search company offers them on the open market.

[Via The Verge and Bloomberg News. More at TechMeme.]

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  • Guest

    Some will mock Google’s loss of its investment. Not me. I support Google’s commitment to risk-taking and innovation. What Google has lost on ClearWire they shall surely make up in sales of their lauded eyeglasses, of which I recently learned.

  • Ron Olander

    Clearwire was a joke, slooow speeds after you signed up and a biiig cancelation fee when you tried to get out

  • UnderSerf

    At least we aren’t bailing out Google…

  • King Co Elections

    Todd, have you done/seen analysis on how LTE “won” over 4G? Which is the dominant tech globally? Is this another Beta v VHS? 

    Sigh. Wrong browser. I do wish Disqus would ASK if this is the twitter account you want to be signed in with. Can you please delete this? @kegill

  • kegill

    Todd, have you done/seen analysis on how LTE “won” over 4G? Which is the dominant tech globally? Is this another Beta v VHS? 

  • chuck goolsbee

    If anything this shows what a poor job of due diligence Google performed prior to investing a huge sum of money. Even the slightest investigation on Google’s part could have prevented this staggering loss. Clearwire seems to be a classic tale of a great idea – with a bad execution.

    The flip side (Google) shows what happens to a bunch of kids when they suddenly find themselves floating on an ocean of money – they spend it foolishly. 

    • Anonymous

      Makes you wonder who’s making decisions at Google that still has a job after losing $453M of Google’s money.

    • Guest

      Google has $43 billion in cash on hand, more than Microsoft and Amazon combined. I certainly don’t expect a $453 million (M) investment impairment to hurt Google very much.

      Google certainly didn’t have a crystal ball. If we all knew which investments were good, we’d all be trillionaires. As it stands, some men win and some lose. Google has done a lot more winning than losing.

    • Guest

      If you don’t take risks, you’ll never know if there is to be a payoff. Companies (and people) that are entirely risk-averse or experimentation-averse fade away. Plus, unless you’re at the C-level of Google, you have *no idea* what Google actually got out of it.

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