Shares of Sprint (NYSE: S) Nextel closed at $6.17 apiece on Tuesday, the lowest level since 1988 on the best day the street had in five years, and fell even further Thursday. At such bargain stock prices — the third largest U.S. wireless company has a market cap of $17.3 billion, or less than half what Microsoft (NSDQ: MSFT) is offering Yahoo (NSDQ: YHOO) — analysts are feverishly speculating the company’s fate.
AP offers a round-up of the rumors today:
– A Merrill Lynch analyst speculates that Deutsche Telekom (NYSE: DT), the parent company of T-Mobile USA, might consider buying Sprint to bulk up and prevent an escalation of flat-rate pricing in the industry.
– Carlos Slim, who operates the wireline and wireless networks in Mexico, might see Sprint as a way to get into the U.S. wireless market, WSJ reports.
– Verizon Wireless (NYSE: VZ) and various U.S. cable providers, looking to fight traditional telephone companies, are potential buyers.
– The company sells off its WiMax or Nextel networks.
– Spins off its WiMax network and merges it with Clearwire (NSDQ: CLWR) with the help of Intel (NSDQ: INTC), or other investors.
At the same time, some of these scenarios are seriously out there, and doubtful. This week, Sprint Nextel said it couldn’t easily be split off Nextel, which it bought three years ago. Bloomberg reported that Chief Network Officer Kathy Walker said separating operations would take longer than integrating them — Sprint’s technicians work on both technologies and it has combined network-monitoring operations. The AP also reported that a Stanford Group analyst doubts the company would be able to sell its Nextel-branded network because it’s bleeding the most customers.
Of course, there is one last option — Sprint will have to conduct a turnaround all by itself.
Amazingly the artice leave s out the most likely tie-up. One with Alltel and parents TPG Capital and GS Capital Partners….
Tony-
Your are 100% wrong, Alltel can't afford to take on the significant debt that Sprint has built up.
justin is correct…alltel has had their ducks in a row to be bought out for quite sometime….verizon is very comfortable with the licensing agreement they have with the cdma network. I believe Alltel is owned by some rich guy as an investment, which is more reason for them wanting to sell….no way Alltel even considers buying sprint/nextel…..
I work for a company that does the call center operations for Sprint/Nextel customer service. I have worked with many customers who wish to cancel their service and were being given $200 in adjustments off their account balance to stop them from cancelling their service.
Customer service reps are no longer allowed to mess up your bill and they are getting caught in the act and terminated for doing so.
There's been carelessness all over sprint and Sprint will not likely be around much longer but I do wish them luck, I believe they can turn this around if they take a more ethical, value oriented, or a more customer service oriented approach as I've worked their customer service and always knew it was bad….I assure you I've tried to feverishly turn it around myself but will be giving notice to find another job myself as the customer calls seem to get more and more frequent that customers were abusively transferred, sold the wrong products, or were caused billing errors that are both irritating for them and myself to troubleshoot given the careless errors made by other representatives….
Farewell Sprint, good luck.