Intel is to sell up to 10 million of its shares in wireless service provider Clearwire.
The sales were revealed in a filing with the Securities and Exchange Commission, with the aim of gaining tax benefits. Intel did not specify what form these benefits would take.
Intel owns 102,404,811 Class A common shares in Clearwire, making up 32.8 per cent of the business. The sale will account for close to 10 per cent of Intel's stake in the company and around three per cent of Clearwire's total shares.
Intel will sell the shares through its venture capital division, Intel Capital. They will be sold on the open market from Friday.
Intel invested in Clearwire to support the rollout of WiMAX, but doubts over the success of this in the face of the more popular LTE network may have caused Intel to have second thoughts. However, the company said “WiMAX continues to be strategically important to Intel.”
Intel also said that the shedding of stock won't affect any of its contractual obligations or business arrangements with Clearwire.
Clearwire share values plummeted after the news, falling $0.55 to $4.18, a drop of 11.63 per cent. Intel still owns nearly a third of the company, but the decision to sell off stock has spooked many investors.