Why Sprint goes it alone and what may change that
Article Abstract:
Sprint has not participated in the recent telecommunications industry consolidation trend, but Chmn William T. Esrey foresees opportunities for the third-largest US long-distance carrier and lucrative local phone business. International companies could become partners with Sprint if they choose to expand in the US. Esrey has established a cautious domestic merger approach, preferring to wait for better future deals. Some Sprint executives championed a merger with GTE, which instead was acquired by Bell Atlantic for $52.9 billion in summer 1998. GTE had miscalculated earlier by selling its entire stake in Sprint, the long-distance carrier it formed in 1986 with United Telecommunications, to United for $1.1 billion. Sprint is reluctant to welcome Bell suitors because the Bells are prohibited from selling long-distance services in their traditional regions. Suitors may have to purchase Sprint shares for $100 each, compared to the approximately $70 values they have commanded for most of 1998.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1998
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Mapping the telecommunications scene
Article Abstract:
Corporate consolidation will continue to impact the telecommunications industry, according to AIM Global Telecommunications Fund Manager Michael J. Mahoney. Investors stand to benefit from deals such as the merger between Bell Atlantic and GTE, as they bring more efficiency and cost reductions to a somewhat undisciplined US sector. Wireless services and equipment are the most attractive segments because consumers can take advantage of the technology's portability. European stock prices hold an advantage over their US counterparts due to a less crowded market. Sprint, meanwhile, is benefiting partly from takeover speculation to inflate its stock value. The AT&T-BT venture may challenge Worldcom-MCI as the leading international carrier, but the pending combination lacks a clear executive structure.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1998
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Comment about this article or add new information about this topic:
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