Puerto Rico - Sprint (NYSE: S) and PRWireless Inc., dba Open Mobile, today announced an agreement to unite their business in Puerto Rico as well as Sprint businesses in the USVI ), Under a new joint venture ("Joint Venture"). The union of both Telecommunications companies will create a stronger competitor. It will offer postpaid service (with contract), prepaid (without contract), Lifeline and business services. The combined company will offer more extensive coverage, greater speed and capacity. Sprint and Open Mobile will have 68% and 32% of the economic interest and 55% and 45% of the interests to vote, respectively. Evercore served as financial advisor for Open Mobile in the transaction.
"The combination of Sprint and Open Mobile will put us in a better position for sustainable growth and long-term success in the competitive Puerto Rican market," said Claudio Hidalgo, Sprint Regional President for Florida, Puerto Rico and the Virgin Islands. "We will be able to operate more efficiently, integrating our employees, sales operations, our networks and bandwidth, creating an improved mobile experience for our customers."
"By analyzing the strengths of each company, we identified an excellent opportunity to join forces for the benefit of our customers and employees," said Juan Saca, CEO of Open Mobile. "Our employees will be able to offer more competitive plans and better wireless coverage, while our existing customers would have a wider variety of equipment to choose from and plans that would include domestic coverage and international roaming ."
The joint venture will benefit from the strengths of Sprint and Open Mobile, and will be managed day by day in Puerto Rico by a president, who will be named soon. An independent Board of Directors will be created with representatives appointed by both companies. The closing of the transaction is subject to review and approval by the Federal Communications Commission (FCC), along with other regulators, which is expected to take several months.
Both companies will continue to operate separately, under their current brands, until the transaction closes. Open Mobile, Sprint, Boost Mobile and Virgin Mobile customers do not need to take action at this time. They may remain with their existing equipment and service plans. All customers can expect a smooth transition, and additional information will be provided when the transaction is closed.
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