Sprint Nextel to Acquire Wireless Affiliate Alamosa Holdings

[ComicalMoodyDan]

Sprint Nextel to Acquire Wireless Affiliate Alamosa Holdings
Monday November 21, 10:17 am ET

RESTON, Va. & LUBBOCK, Texas--(BUSINESS WIRE)--Nov. 21, 2005--Sprint Nextel Corp. (NYSE:S - News):

* Approximately 1.48 Million PCS Wireless Users to Become Direct Subscribers of Sprint Nextel
* Extends Company's Direct Service Territory to an Additional 20 Million People in 19 States

Sprint Nextel Corp. (NYSE:S - News) and Alamosa Holdings, Inc. (NASDAQ:APCS - News) today announced an agreement for Sprint Nextel to acquire Alamosa Holdings for approximately $4.3 billion, including the assumption of approximately $900 million of net debt. This transaction value represents 9.8x projected 2006 Adjusted Operating Income Before Depreciation and Amortization ("Adjusted OIBDA" *).

Under the terms of the agreement, Sprint Nextel will acquire all of Alamosa's outstanding common shares for $18.75 per share (including Series B Preferred stock on an "as converted" basis) in an all-cash merger. The acquisition is subject to the approval of Alamosa shareholders and customary regulatory approvals, and is expected to be completed in the first quarter of 2006.

"This acquisition closes a long partnership with the management and shareholders of Alamosa," said Gary Forsee, president and CEO, Sprint Nextel. "As the largest PCS affiliate, we appreciate their efforts over the years to grow Sprint's business and we look forward to continuing a strong relationship with their customers. This transaction will significantly expand our direct customer base and territory, and will provide additional value for our shareholders."

David Sharbutt, chairman and chief executive officer of Alamosa Holdings, Inc., said: "We are pleased to accept Sprint's offer to acquire our company. We have enjoyed a successful business relationship with Sprint that has benefited both companies. We not only helped Sprint build the nation's best nationwide wireless network, but also successfully brought the Sprint suite of products and services to our territories over the past 6 years. Our shareholders and employees can be proud of our results and the value that we have created in Alamosa."

Alamosa Holdings, based in Lubbock, Texas, provides Sprint PCS services in 19 states, serving approximately 1.48 million direct wireless subscribers in 242 customer service areas (CSA's). It is the largest Sprint PCS wireless Affiliate (based on number of subscribers) and has reported superior operating metrics, including the highest penetration and lowest churn rates of the Sprint PCS Affiliates. Alamosa employs about 1,300 people and had pro forma (for the acquisition of AirGate completed in the 1st Quarter of 2005) revenues for the twelve months ended September 30, 2005 of $1,318 million. With this acquisition, Sprint has announced agreements to acquire more than 2.3 million Sprint PCS affiliate customers.

On Aug. 8, 2005, Alamosa filed a complaint against Sprint regarding certain exclusivity covenants Sprint had with Alamosa's subsidiary AirGate. As part of the agreement, Sprint Nextel and AirGate will seek an immediate stay of litigation pending in the Delaware Court of Chancery with a final resolution to become effective upon closing of the acquisition.

About Alamosa

Alamosa Holdings, Inc. is the largest (based on number of subscribers) Sprint PCS Affiliate of Sprint Nextel (NYSE:S - News), which operates the largest all-digital, all-CDMA Third-Generation (3G) wireless network in the United States. Alamosa has the exclusive right to provide digital wireless mobile communications network services under the Sprint Nextel brand name throughout its designated territory located in Texas, New Mexico, Oklahoma, Arizona, Colorado, Utah, Wisconsin, Minnesota, Missouri, Washington, Oregon, Arkansas, Kansas, Illinois, California, and subsequent to year end in Georgia, South Carolina, North Carolina and Tennessee which includes licensed population of 23.2 million residents.

http://biz.yahoo.com/bw/051121/20051121005538.html?.v=1

[larry]

This is certainly great news for those Sprint affiliate customers who are unhappy about the certain plans and promotions that are only offered through Sprint corporate. Now they can have full access to everything Sprint offers. Plus Sprint picks up another 1.5 million customers out of this.

[budney]

Very good news indeed!

[larry]

Now when Sprint corporate reports their quarterly customer additions they will get a boost of about 30k to 40k customers each time.

[WirelessBeachBum]

This should help stablize the lives of the wireless employees in those markets...the airgate markets in particular have been in constant flux with management changes, and employee turnover...Benefit reductions etc.

Many of the Alamosa employees in these markets are pretty new to wireless, I was speaking to a few last week and they were spouting how "they now own Nextel." I just laughed to myself...um..."you don't own Nextel, in all likelyhood Alamosa will be bought out by Sprint." They didn't believe me...

[larry]

Just an update. The Alamosa deal was given the green light today by the Feds. Merger to close within 30 days.

[bobolito]

Originally Posted by larry

Now when Sprint corporate reports their quarterly customer additions they will get a boost of about 30k to 40k customers each time.

Why would they get a boost? Haven't they already been counting the affiliates in the total customer count every quarter for years, which was a controversial practice we discussed?

[larry]

Originally Posted by bobolito

Why would they get a boost? Haven't they already been counting the affiliates in the total customer count every quarter for years, which was a controversial practice we discussed?

Yep but now those customers will be 100% official instead of having an asterik by them.

[Matt]

Originally Posted by larry

Yep but now those customers will be 100% official instead of having an asterik by them.

And we won't be able to rag on Larry as much

But true, in the total cusomter figure nothing will change.