July 13, 2005 12:36 PM PDT
Sprint, Nextel shareholders approve merger
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About 70 percent of Nextel's shareholders and more than 90 percent of Sprint's shareholders gave the planned deal the thumbs-up during separate votes Wednesday.
Sprint's proposed purchase of Nextel for about $36 billion must still be approved by the Federal Communications Commission.
"The Sprint and Nextel merger is a bold move that will allow the newly merged company to play a winning hand," Sprint Chairman Gary Forsee said in a statement.
The confidence expressed Wednesday by the shareholders is part of an overall mood of investor acceptance for major telecommunication mergers, even though the consolidating phone industry will likely mean higher-priced phone calls because there will be less competition.
Merger mania began in 2004, when top-tier cell phone operators AT&T Wireless and Cingular Wireless merged. Shareholders also overwhelmingly approved that deal. Cingular is now the No. 1 carrier in the United States, followed by Verizon Wireless.
Also, local phone giant SBC Communications is buying rival AT&T for $16 billion. And a drawn-out bidding war for MCI, which pitted would-be buyers Qwest Communications International against Verizon Communications, ended recently with Verizon as the apparent winner.
Additionally, a number of failing rural cell phone operators have been devoured by second-tier wireless carriers.