Tags: sprint | hesse | wireless | consolidation

Sprint's CEO Predicts Wave of Deals in Wireless Industry

Wednesday, 19 September 2012 03:54 PM

Shares of Sprint Nextel Corp., the third-largest U.S. wireless carrier, jumped Wednesday after the company's chief executive, Dan Hesse, said the company would probably play a role in future industry consolidation.

Just before the close of New York trading, Sprint's shares were up 7.1 percent at $5.56 in New York, bolstering a stock that had already more than doubled this year.

The industry is likely to undergo a wave of mergers and acquisitions, Hesse told a Goldman Sachs Group Inc. investment conference Wednesday in New York. Consolidation would let smaller U.S. wireless carriers band together to take on the two largest competitors, Verizon Wireless and AT&T Inc.

Sprint may be in a position to buy a prepaid carrier such as MetroPCS Communications Inc., Jason Armstrong, a Goldman Sachs analyst, said last week in a report.

MetroPCS shares rose 5.2 percent to $11.30 Wednesday. Clearwire Corp., the provider of a high-speed wireless network that counts Sprint as its biggest customer and investor, gained 13 percent to $1.56 in late Nasdaq trading.

There are two types of deals Sprint may encounter, Hesse said. One is a large-scale deal to gain enough size to better challenge the two dominant competitors. The other would be smaller and have more immediate cost benefits and synergies, he said.

Hesse has said he wouldn’t want to enter a deal that would be a distraction while the Overland Park, Kansas-based company builds a new network using long-term evolution, or LTE, technology. Sprint is trying to catch up with more extensive LTE networks offered by Verizon and AT&T.

© Copyright 2019 Bloomberg News. All rights reserved.

1Like our page
Shares of wireless carriers jumped after Sprint Nextel's CEO said the industry is likely to undergo a wave of mergers and acquisitions.
Wednesday, 19 September 2012 03:54 PM
Newsmax Media, Inc.

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved