Time Warner Cable Inc (NYSE:TWC), the second-largest U.S. cable company, is planning to sell its stake in wireless service provider Clearwire Corporation (NASDAQ:CLWR). The move was announced in a document filed with U.S. Securities and Exchange Commission on Friday. The plan to sell its stake in Clearwire follows the cable company’s agreement to sell spectrum to Clearwire’s biggest rival, Verizon Wireless.

time warner cable logo

As per a spokesman from Clearwire, Time Warner Cable Inc (NYSE:TWC) owns approximately 46 million shares in Clearwire, which represent a 7.8 percent economic interest and just over 3 percent of the voting shares in Clearwire. Sprint Nextel Corporation (NYSE:S), Clearwire’s biggest shareholder, recently told that they had enough funds to last it another year and are working together for overhauling its network and seeking partnerships or asset sales to raise cash.

Cash-strapped Clearwire Corporation (NASDAQ:CLWR) has witnessed numerous investors walking away from it. Google Inc (NASDAQ:GOOG) offloaded its entire 29.4 million share stake for a $433.5 million loss in March and Intel Corporation (NASDAQ:INTC) wrote down the entire value of its 7.3% voting stake in Clearwire Corporation (NASDAQ:CLWR) earlier this year. Clearwire prime assets include a major chunk of airwave licenses and the company intends to sell wholesale wireless services. Clearwire, unlike its competitors, is a bit late in rolling out a fourth-generation network that runs on LTE technology, a transition from its original WiMax service.

Time Warner Cable which previously depended on Clearwire Corporation (NASDAQ:CLWR) as its wireless wholesale partner plans to offload its entire 7.8% stake in struggling mobile-broadband provider Clearwire. Disclosing its intentions in the filing, Cable Company notified other major Clearwire investors, of an option to buy part or the entire stake. The move from the cable company comes at a critical point when cable operators once interested in entering the wireless business, have changed thoughts and are spinning their airwave licenses. Time Warner purchased 46.4 million shares of Clearwire in 2008 by paying $550 million, but those shares would be worth only about $73.3 million at current prices. The New York based firm has also entered into a wireless service agreement with Verizon Wireless under which it will sell wireless services using the Verizon Wireless network.

“It seems like an opportune time to start to sell the shares in light of the company’s arrangements with Verizon Wireless,” Justin Venech, a Time Warner Cable spokesman, said in an e-mail.

UBS (NYSE:UBS) analyst John Hodulik said Time Warner Cable Inc (NYSE:TWC) had already written down its investment in Clearwire and would likely use the cash for share repurchase.

Clearwire shares fell 5 percent on Monday on the NASDAQ to close at $1.54, their lowest in nearly two weeks.