Sprint to buy wireless reseller U.S. Unwired

Sprint to buy wireless reseller U.S. Unwired

US mobile company Sprint is in the process of merging with Nextel and one of the prime problems in that deal was the wireless reseller U.S. Unwired that posed a legal challenge to the deal. Sprint has now decided that they would be paying around USD 1.3 billion in cash to acquire the U.S. Unwired company. In fact, lawyers representing both these companies were due to appear in the courts later this year to discuss the issues pertaining to the merger.

US Unwired had filed an injunction in courts to block the deal between Sprint and Nextel claiming that the deal violated a non-compete agreement in its 1998 contract with Sprint. Nextel is in competition with US Unwired in markets like Alabama, Mississippi, Tennessee, and Texas. Now that Sprint would own the company, both the companies would settle for a withdrawal.

Gary Forsee, Sprint’s CEO, said in a statement about this deal: “This acquisition would bring an end to a long partnership with the management and shareholders of US Unwired. We appreciate their efforts over the years to grow the Sprint business in its assigned territories.” US Unwired provided services provided by Sprint to around 500,000 subscribers in nine states.

US Unwired employees around 600 workers and had a profit of $408 million last year. Sprint and Nextel are merging together to form an entity that would have the capabilities to take on communications giant Cingular and Verizon Wireless for voice and data customers in the American market.