Sprint, Nextel to Unite Friday
Posted on: Wednesday, 10 August 2005, 21:00 CDT
Aug. 10--The $78 billion merger of Sprint Corp. and Nextel Communications will be completed on Friday, officials of the two companies said Tuesday.
Shares of stock in the new company, Sprint Nextel Corp., will begin trading on the New York Stock Exchange on Monday. Sprint will drop its traditional "FON" trading symbol and trade under the symbol "S."
Sprint shares closed Tuesday up 58 cents, or 2.2 percent, at $26.62. Nextel shares were up 73 cents, or 2.1 percent, at $34.51.
Last week, federal regulators gave officials of Sprint and Nextel the go-ahead for the merger. The companies are billing the transaction as a "merger of equals," but officially Sprint is buying Nextel for about $39 billion.
The actual value of the transaction, which hinges on stock price, will not be set until the deal closes.
Sprint and Nextel announced the planned merger last December. The combination will create a larger wireless competitor to challenge market leaders Cingular Wireless and Verizon Wireless.
The combined company initially will have annual sales of more than $40 billion and about 79,000 employees.
Some layoffs are likely as the companies seek to meet promises made to Wall Street that the combination would save $12 billion over time.
Additionally, in about a year, Sprint plans to spin off its local phone service division, which has about 7.5 million lines in 18 states, into a new, publicly traded company.
That company is expected to draw about 20,000 employees from Sprint Nextel.
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FON, NXTL,
Source: The Kansas City Star (Kansas City, Missouri)
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