![](http://investorshub.advfn.com/images/default_ih_profile2_4848.jpg?cb=0)
Thursday, December 09, 2004 11:49:12 PM
Neither Company Will Confirm Negotiations
http://www.washingtonpost.com/wp-dyn/articles/A53244-2004Dec9.html?nav=rss_topnews
By Ellen McCarthy
Washington Post Staff Writer
Friday, December 10, 2004; Page E01
Nextel Communications Inc. and Sprint Corp. are negotiating a possible merger, according to a source familiar with the discussions.
It was not clear how far the talks had progressed, and some analysts questioned whether a deal combining Nextel, the nation's fifth-largest mobile phone carrier, and Sprint, the third-largest, would be made.
Nextel Communication's walkie-talkie service has made the company popular with business customers. (Daniel Acker -- Bloomberg News)
A merger would give Reston-based Nextel access to Sprint's high-speed data network, saving Nextel more than $2 billion it has been planning to spend to build its own. It would give Sprint of Overland Park, Kan., access to Nextel's well-regarded management team and its business-oriented customer base, which produces the cell phone industry's highest revenue per customer.
Both companies declined to comment on the merger talks, which were reported yesterday by the Wall Street Journal and CNBC. Nextel's stock closed up 7 percent at $29.81. Shares of Sprint rose 8 percent to $24.28.
A Nextel-Sprint merger could give a combined company the heft to compete with the industry leaders in a time of consolidation. Together, the two companies would have about 39 million subscribers, said Rick R. Black, an analyst with Blaylock & Partners LP, behind Cingular Wireless LLC's 47 million customers and Verizon Wireless's 42 million. Cingular became the biggest wireless-service provider through its recent $41 billion acquisition of AT&T Wireless Services Inc.
Nextel has long been a leader of the Washington area's telecommunications industry. The company was founded in 1987 and grew by acquiring walkie-talkie licenses from taxicab dispatch operators. The cobbled-together system proved to have a big advantage: Nextel's push-to-talk feature, with its instant call connections, was especially attractive to business customers.
In 1995, Craig O. McCaw, a leader in the wireless industry, and his family invested $1.1 billion in Nextel and spearheaded the debt-burdened company's return from the brink of bankruptcy. The firm expanded its product and service offerings. Today it has about 18,000 employees nationwide, including about 2,500 in the Washington area.
Timothy M. Donahue took over as president and chief executive in July 1999 and has worked to raise the company's profile. The company stepped up its Washington lobbying efforts and signed a deal, reportedly worth $700 million to $750 million, to put its name on NASCAR's leading racing series. Nextel also won initial approval from the Federal Communications Commission for a multibillion-dollar swap of broadcast frequencies that would give it a better part of the communications spectrum while eliminating conflicts with public-safety communications.
Some industry analysts said a Nextel-Sprint combination would make sense.
"Both companies have interesting things to bring to the table, and creating a wireless company that could compete with the big boys is an interesting proposition," said Gregory J. Teets, a telecom analyst with A.G. Edwards & Sons Inc. "Nextel is known for having a very good management team, very good customer service," he said. "Sprint brings a relatively advanced network."
Others said the merger would be difficult to pull off.
Because the companies are roughly the same size, the deal is likely to be framed as a merger of equals. Such a deal could be problematic, analysts from Goldman Sachs & Co. wrote in a research report.
"We think that Nextel has more to gain than Sprint and therefore would have to have that value reflected in the transaction," the Goldman report said.
Sprint has a market capitalization of $33.1 billion, compared with Nextel's $31 billion. But Nextel has been much more profitable, earning $1.53 billion on $10.82 billion in revenue in 2003. Sprint earned $1.2 billion on revenue of $26.2 billion in that year.
While the deal would narrow the number of major wireless competitors to four, a source close to federal regulators suggested that it would be likely to withstand regulatory scrutiny. The source declined to be identified because talks are continuing.
Some analysts said they expect more deals in the telecom industry.
"We believe that consolidation within the wireless space is inevitable and it would ultimately lead to greater control of pricing for the wireless providers," Black said.
Recent QCOM News
- Form 8-K - Current report • Edgar (US Regulatory) • 08/09/2024 08:05:49 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/09/2024 08:05:43 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/09/2024 08:05:27 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 08/08/2024 09:01:47 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/05/2024 09:03:28 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 08/02/2024 08:01:38 PM
- Qualcomm Gewinnmitteilung auf der Investor Relations Website des Unternehmens verfügbar • Business Wire • 07/31/2024 10:50:00 PM
- Publication des résultats de Qualcomm disponible sur le site web de la société consacré aux relations avec les investisseurs • Business Wire • 07/31/2024 10:50:00 PM
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 07/31/2024 08:02:08 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 07/31/2024 08:01:12 PM
- Qualcomm Earnings Release Available on Company’s Investor Relations Website • Business Wire • 07/31/2024 08:00:00 PM
- US Index Futures Up Ahead of Fed Decision; Oil Prices Surge Amid Middle East Tensions • IH Market News • 07/31/2024 10:01:30 AM
- AMD Shares Surge 9% on Earnings Beat; Match Group Rises 10%, Pinterest & Lemonade Drop 13%, and More Earnings Updates • IH Market News • 07/31/2024 09:59:10 AM
- Qualcomm gibt Datum der Ergebnismeldung für das dritte Quartal 2024 und der Konferenzschaltung bekannt • Business Wire • 07/19/2024 08:32:00 PM
- Qualcomm annonce qu’elle va publier prochainement ses résultats pour le troisième trimestre de l’exercice 2024 et qu’elle tiendra une conférence téléphonique • Business Wire • 07/19/2024 04:22:00 PM
- Qualcomm Schedules Third Quarter Fiscal 2024 Earnings Release and Conference Call • Business Wire • 07/19/2024 01:00:00 PM
- Qualcomm gibt Quartalsbardividende bekannt • Business Wire • 07/17/2024 06:43:00 PM
- Qualcomm annonce le versement du dividende en espèces trimestriel • Business Wire • 07/17/2024 06:43:00 PM
- Qualcomm Announces Quarterly Cash Dividend • Business Wire • 07/17/2024 01:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 07/08/2024 09:39:01 PM
- U.S. Index Futures Mixed Following Tech Sell-Off, WTI and Brent Crude Dip Slightly • IH Market News • 06/25/2024 10:37:15 AM
- Trump Media Resells Stocks and Warrants; KB Home Exceeds Q2 Expectations, and More News • IH Market News • 06/20/2024 10:55:11 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 06/04/2024 08:07:43 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 06/04/2024 08:07:25 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 06/03/2024 09:27:46 PM
Maybacks Global Entertainment and ZEASN Technology Private Ltd. Sign Global Licensing Agreement • AHRO • Aug 8, 2024 7:00 AM
SANUWAVE Will Host a Conference Call on August 13, 2024 at 8:30 AM (ET) to Present Q2 Financial Results • SNWV • Aug 8, 2024 6:59 AM
Kona Gold Beverage Inc. Signs Letter of Intent with Bemax, Inc. to Sell Kona Gold, LLC • BMXC • Aug 7, 2024 10:00 AM
Btab Ecommerce Group, Inc. Launches Investor Connect AI Chatbot for Enhanced Investor Engagement and Lead Generation • BBTT • Aug 7, 2024 9:00 AM
Hydromer, Inc. Announces Preliminary Unaudited Second Quarter 2024 Financial Results and Provides Business Update • HYDI • Aug 7, 2024 8:52 AM
North Bay Resources Announces Mt. Vernon Gold Mine Startup, Sierra County, California • NBRI • Aug 5, 2024 9:00 AM