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Global Deals Review: 2011 Q3 »
Global Deals Review: 2011 Q2 »
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Inflows Outflows »
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Dan Hesse, CEO of the Sprint Nextel Corporation addresses attendees during the International CTIA WIRELESS Conference & Exposition in New Orleans, Louisiana May 8, 2012.
Credit: Reuters/Sean Gardner
NEW YORK |
Wed May 16, 2012 4:21pm EDT
NEW YORK (Reuters) - Sprint Nextel believes U.S. regulators are open to large telecom deals despite their opposition to an AT&T Inc deal last year, but Sprint itself will try to avoid doing a big deal until 2014, according to Chief Executive Dan Hesse.
Hesse said Sprint would ideally wait until it is finished a costly two-year network upgrade project that wraps up around the end of 2013 before he embarks on any major deals.
But he said that the company may end up having to pull the trigger on a deal sooner than this if there was a concern it would miss out on savings or get beaten by a competitor.
Sprint would "look at the risk and opportunities on the synergies side and those will have to be weighed," Hesse said during a webcast of an investor conference.
" If we could push it to later we would ," the executive added. Aside from the financial pressure that an acquisition would bring, Hesse also noted that any deal prospects might be hurt by Sprint's low share price.
"It's not an ideal time for our equity because of the big investments we're making now," Hesse said.
Hesse made the comments against a backdrop of speculation about mergers in the U.S. telecommunications market, where the biggest and the smallest operators say they are severely in need of additional wireless airwaves.
In February this year, Sprint's board vetoed a bid by the company to buy smaller rival MetroPCS Communications.
Some analysts say it might be tough for any of the big four U.S. mobile operators to make an acquisition because regulators had fought the plan No 2 U.S. mobile provider AT&T to buy No. 4 U.S. operator T-Mobile USA last year.
But Hesse said he believes the opposite is true.
"I honestly don't believe there's a magic number of four at all," Hesse said, adding that regulators would be more receptive to deals that do not involve the top two operators Verizon Wireless and AT&T.
"I actually believe Washington would be receptive to consolidation to provide more balance to the big two," he said, suggesting that the U.S. Federal Communications Commission and the Justice Department "have a pretty open mind about consolidation."
(Reporting by Sinead Carew)
Global Deals Review: 2011 Q3
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