Sprint Says Takeover by Britain’s C & W Not Possible
Sprint Corp. said Wednesday that a takeover of the company by Britain’s Cable & Wireless “could not be possible†because of agreements with European telephone companies that own pieces of Sprint.
The Wall Street Journal reported Wednesday that Cable & Wireless was considering a takeover bid worth at least $15 billion for Sprint, the No. 3 U.S. long-distance company.
The report also said C&W;, Britain’s second-largest telephone company, has negotiated with France Telecom, which owns 10% of Sprint, to line up support for a bid.
Industry analysts have said for some time that Sprint’s Global One international telecommunications alliance with France Telecom and Deutsche Telekom would be a perfect fit for Cable & Wireless.
On Wednesday, Sprint Chairman William Esrey, noting the company normally does not comment on rumors, said, “But in this case, a reported deal with Cable & Wireless supported by France Telecom could not be possible because of the terms of a standstill agreement Sprint has with France Telecom and Deutsche Telekom.â€
Like France Telecom, the German telecommunications giant owns 10% of Kansas City, Mo.-based Sprint. Both European companies are prohibited by the so-called standstill agreements from raising their stakes for now.
France Telecom also denied that it was in talks with C&W; about supporting a possible bid for Sprint.
Despite the denials, the report sent Sprint’s stock soaring up $2 to close at $45.125 on the New York Stock Exchange. U.S. shares of C&W; rose 25 cents to close at $24.25, also on the NYSE.
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