Sprint Nextel says it will buy its largest affiliate, Nextel Partners Inc.,
for $6.5 billion or $28.50 a share price.
The price had been the subject of extended negotiations with each company
hiring advisers to calculate the value of the deal, which was announced
Tuesday. The total value of the acquisition (Sprint Nextel, which had
already owned 32 percent of Nextel Partners) is estimated to be about $10
billion.
Just last month, Sprint Nextelsaid it will pay $4 billion for longtime affiliate Alamosa Holding Co., bringing 1.5 million
subscribers in 19 states directly under its control and short-circuiting a
lawsuit.
In August, Alamosa sued Sprint regarding exclusivity covenants
Sprint had with Alamosa’s subsidiary AirGate. Sprint Nextel has been
actively trying to buy its remaining affiliates.
The deal is subject to customary regulatory approvals, including review
by the Federal Communications Commission and the Department of Justice, and
is expected to be completed by the end of the second quarter of 2006.
The giant merger of Sprint and Nextel became official
in August.
The recently merged company has been anything but quiet this year. In
addition to its purchases, Sprint Nextel and the nation’s largest cable
companies announced last month
they are forming a joint venture to better compete against Baby
Bells and satellite companies.
The deal between Comcast, Time Warner Cable, Cox and
Advance/Newhouse Communications and the wireless carrier speaks to the
fierce competition in the communications industry.
The companies said they plan to “develop converged next-generation
products for consumers that combine the best of cable’s core products and
interactive features with the vast potential of wireless technology.”