Nextel Plans Hostile Bid for NextWave
Nextel Communications Inc. said it plans a $3-billion hostile bid for NextWave Telecom Inc. and asked federal regulators to rule on a plan to pay $5.3 billion for NextWave’s unused wireless phone licenses. The Nextel offer, made in a filing at the Federal Communications Commission, raises the stakes for the 56 licenses NextWave won for $4.7 billion in a 1996 auction, though never developed. NextWave sought Chapter 11 bankruptcy protection in December 1998 when it was unable to pay the commission for the licenses. The licenses are caught in a legal battle in which the U.S. Appeals Court in New York in November overturned a bankruptcy judge’s ruling that the licenses are worth $1.02 billion. The FCC had challenged the Bankruptcy Court. In a filing at the FCC, Nextel said it would pay the agency $5.31 billion cash, offer NextWave shareholders $2.5 billion in Nextel common stock in a hostile tender offer and settle with NextWave’s creditors for $500 million. Earlier, in an agreement with the FCC, Nextel offered to pay up to $6 billion for the wireless licenses. Shares of Reston, Va.-based Nextel rose $1.63 to close at $94.31 on Nasdaq. (Bloomberg News)
* The Communications Workers of America said its members working at Sprint Corp. units in five states voted to authorize a strike against the No. 3 U.S. long-distance telephone company. The union said that members in North Carolina, Florida, Tennessee, Indiana and Oregon voted by a 9-1 margin to take strike action. The CWA said it was continuing to negotiate with Sprint, which is merging with MCI WorldCom Inc., even though contracts with the company covering the 2,700 members have expired. Under CWA rules, the union’s executive board is now voting to approve the strike action, which would enable the CWA president to set a strike date. Shares of Sprint closed up $1.56 at $68.81 on the NYSE.
* Mannesmann, Germany’s largest mobile phone company, won European Union approval for its $41.8-billion purchase of Orange, Britain’s No. 3 cellular operator, after agreeing to sell its stake in an Austrian mobile phone operator. Mannesmann is itself the target of a $150-billion hostile takeover bid by Vodafone Airtouch, the world’s biggest wireless phone provider.
