Sprint Nextel Corp. shareholders today voted to approve the Overland Park, Kan. company’s proposed merger agreement with SoftBank Corp., and after months of waiting Toyko-based SoftBank will take over majority ownership of the U.S. No. 3 wireless carrier.
The $21.6 billion deal will provide Sprint shareholders with $16.64 billion in cash up front, and the other $5 billion will be invested in the company. Sprint CEO Dan Hesse said in a release the move would “enhance Sprint’s long term value and competitive position by creating a company with greater financial flexibility.”
Telecom industry analyst Jeff Kagan said last week he expects the cash infusion to allow a “supercharged” Sprint to expand its 4G LTE network more rapidly and become more competitive with industry leaders Verizon and AT&T.
In exchange for the $21.6 billion, SoftBank takes over a 78 percent stake in Sprint. Sprint spokesman John Taylor said last week that the agreement would keep Hesse and the rest of Sprint’s management team in place and that the company’s headquarters will remain in Overland Park.
Taylor also expressed optimism that the deal will mean “growth for the company and growth of opportunity for our employees.” More than 7,000 of Sprint’s 42,000 U.S. employees work at the Overland Park campus.
Sprint officials and analysts alike expected the deal to be approved after SoftBank increased its offer from $20.1 billion to $21.6 billion earlier this month, which led Englewood, Colo.-based Dish Network Corp. to drop out of the bidding war last week.
Sprint has another major vote on the horizon July 8, when Clearwire’s shareholders will make a decision on Sprint’s offer for the approximately half of the Bellevue, Wash.-based company that it does not already own.