Listen to this article
Sprint Nextel, the third-largest US mobile network operator, agreed to buy another two regional affiliates for $714.5m, in a move that will reduce the threat of long-running legal battles with regional affiliates that which had opposed its $36bn merger.
The company is acquiring Gulf Coast Wireless for $287.5m, including an unspecified amount of debt, and IWO Holdings for $427m, including $20m of net debt. As part of the latest agreement, Sprint Nextel and Gulf Coast said they would seek an immediate stay in their litigation.
Gulf Coast had filed a lawsuit over the Sprint-Nextel transaction.
Affiliates such as Alamosa Holdings and UbiquiTel also sued to ensure the Sprint-Nextel deal would not increase competition and hurt sales.
Sprint Nextel has moved quickly in recent months to resolve a string of legal disputes with affiliates that resell wireless services, mostly stemming from its merger.
Ahead of the merger, which was completed this month, Sprint bought affiliate US Unwired for $1.03bn after the company asked a judge to block the deal.
Last month Sprint Nextel reached a five-month agreement with some affiliates, including iPCS, that puts lawsuits on hold while the companies renegotiate their partnership. Sprint Nextel promised not to compete with affiliates.
The latest purchases will add more than 332,000 customers.
The next big hurdle for Gary Forsee, chief executive, will be with Nextel Partners. The affiliate, which had an agreement with Nextel under which it could force Sprint Nextel to buy the company, is fighting over how to set the price.
Analysts believe that Sprint Nextel could end up paying as much as $14bn buying affiliates.
Get alerts on Telecoms when a new story is published