Full Article: Leap Wireless Seeks a Buyer - WSJ.com

Cellular provider Leap Wireless International Inc. has hired advisers and formed a special board committee to look into selling the company or merging with rivals, several people familiar with the matter said.

Leap, which sells its service under the Cricket brand and has about 4.7 million customers, has hired Goldman Sachs Group to advise the company as it "reassesses its alternatives and checks its options out there right now," according to one person familiar with the process.

While some bankers consider rival MetroPCS Communications Inc. as the most likely partner for Leap, the company's advisers have in recent weeks been feeling out larger wireless carriers such as AT&Ticon Inc. and Verizon Wirelessicon to see if they would be interested in acquiring Leap, these people said.

So far, those talks haven't lead to any deal. But the conversations indicate Leap, which provides prepaid service aimed at the lower end of the market, is feeling squeezed as major carriers like AT&Ticon, Verizonicon and Sprint Nextel Corp. encroach on its prepaid turf and slash their contract rates.

One indicator of the change in prepaid operators' fortunes: Leap in late 2007 spurned an unsolicited all-stock offer from MetroPCS initially valued at $5.5 billion, about five times Leap's current market value.

Leap's board has also formed a three-person committee to assess strategic options. That committee—made up by newly appointed board members John H. Chapple, Ronald J. Kramer and William A. Roper—is being advised by Morgan Stanley, these people said. Mr. Chapple is a former CEO of Nextel Partners, which Sprint acquired in 2006.

It wasn't clear if Leap and MetroPCS are currently in talks, but that combination is "the one that makes the most sense for Leap, and both sides know it," said one of the people familiar with the matter. The person added it appeared Leap was trying to round up a bidder to prod MetroPCS to pay a higher price for any potential bid. Leap shares closed Monday at $14.92, well below the $41 its shares hit in May.

MetroPCS and Leap have similarities in their strategies, customer bases and mobile technologies. A Leap spokesman didn't reply to requests for comment. A MetroPCS spokesman declined to comment.
Come on Metro, make this happen!