Sprint Nextel Preparing to Scrap $9 Billion Network Sharing Deal with LightSquared
Published on: 7th Mar 2012
Note -- this news article is more than a year old.
By: Ian Mansfield
Further problems for the USA embryonic LTE network LightSquared following reports that Sprint Nextel is preparing to kill a USD9 billion network sharing deal with the company.
LightSquared, which has been in a battle royal with the regulator over claims that its network will interfere with GPS receivers has until March 15th to resolve the matter. After that Sprint Nextel has an option to terminate the network sharing agreement.
Citing two people familiar with the matter, Bloomberg News reported that Sprint Nextel is prepared to do just that, as early as next week. Sprint had already previously extended the deadline to give LightSquared more time to deal with its regulatory headaches, but is unwilling to offer further concessions.
Last July, Sprint Nextel and LightSquared signed a 15-year agreement to share their spectrum and network infrastructure, but the deal is conditional on timely FCC approvals.
Under the terms of the agreement, during an 11 year period, Lightsquared will make payments to Sprint of approximately USD9 billion in cash for spectrum hosting and network services as well as LTE and satellite purchase credits which are currently estimated to be valued at approximately USD4.5 billion.
On the web: Bloomberg News