NEW YORK - South Korea's SK Telecom Corp. is in talks to buy struggling U.S. wireless carrier Sprint Nextel Corp., business news channel CNBC reported Tuesday
An agreement would be at best weeks away, CNBC said, citing people familiar with the talks.
Sprint shares closed up 9 percent at $9.04.
U.S.-listed shares of SK Telecom, Korea's largest mobile-phone service operator by subscriber numbers, fell 2 percent to $20.67.
Sprint spokesman James Fisher had no comment on the report. No SK Telecom representatives were available in the early morning hours, Korean time.
CNBC reported that private-equity firms would provide financing for the deal, since SK Telecom's market value is about half of Sprint's $22.6 billion.
Sprint has been losing subscribers for some time, but it's still the third-largest wireless carrier in the U.S., with 52.8 million subscribers at the end of the first quarter. Its stock has lost half its value in the last year, and there have been reports that the company has been talking to other possible acquirers, like T-Mobile USA.
Bank of America analyst David Barden said that CNBC's report reflected that Sprint's board "is prudently and consistently evaluating all its options." He believes the company is more likely to try to press ahead with a turnaround plan.
Walter Piecyk, an analyst with Pali Research, said on his firm's blog that it was more likely that SK Telecom was seeking to make an investment in Sprint. It is believed to have offered $5 billion last November but was ultimately rebuffed.
"The lack of liquidity in the capital markets would make an outright purchase difficult for a company the size of SK Telecom no matter how many private-equity companies would be involved," Piecyk wrote.
SK Telecom has been trying to get a beachhead in the U.S. for some time. In 2006, it launched Helio, a joint venture with EarthLink Inc. that aimed to charm college-age Americans with high-end Korean-style handsets and data services. Helio never found much of an audience, and last month, it was merged into Virgin Mobile USA Inc., giving SK Telecom a 17 percent stake in the combined company.
Through Helio, SK Telecom has dealt with Sprint as a customer. Both Helio and Virgin Mobile use Sprint's network.
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AP Business Writer David Twiddy in Kansas City, Mo., contributed to this report.
(This version CORRECTS Corrects closing Sprint stock price. ADDS details; EDITS to eliminate extraneous "called" in 9th graf.)
An agreement would be at best weeks away, CNBC said, citing people familiar with the talks.
Sprint shares closed up 9 percent at $9.04.
U.S.-listed shares of SK Telecom, Korea's largest mobile-phone service operator by subscriber numbers, fell 2 percent to $20.67.
Sprint spokesman James Fisher had no comment on the report. No SK Telecom representatives were available in the early morning hours, Korean time.
CNBC reported that private-equity firms would provide financing for the deal, since SK Telecom's market value is about half of Sprint's $22.6 billion.
Sprint has been losing subscribers for some time, but it's still the third-largest wireless carrier in the U.S., with 52.8 million subscribers at the end of the first quarter. Its stock has lost half its value in the last year, and there have been reports that the company has been talking to other possible acquirers, like T-Mobile USA.
Bank of America analyst David Barden said that CNBC's report reflected that Sprint's board "is prudently and consistently evaluating all its options." He believes the company is more likely to try to press ahead with a turnaround plan.
Walter Piecyk, an analyst with Pali Research, said on his firm's blog that it was more likely that SK Telecom was seeking to make an investment in Sprint. It is believed to have offered $5 billion last November but was ultimately rebuffed.
"The lack of liquidity in the capital markets would make an outright purchase difficult for a company the size of SK Telecom no matter how many private-equity companies would be involved," Piecyk wrote.
SK Telecom has been trying to get a beachhead in the U.S. for some time. In 2006, it launched Helio, a joint venture with EarthLink Inc. that aimed to charm college-age Americans with high-end Korean-style handsets and data services. Helio never found much of an audience, and last month, it was merged into Virgin Mobile USA Inc., giving SK Telecom a 17 percent stake in the combined company.
Through Helio, SK Telecom has dealt with Sprint as a customer. Both Helio and Virgin Mobile use Sprint's network.
___
AP Business Writer David Twiddy in Kansas City, Mo., contributed to this report.
(This version CORRECTS Corrects closing Sprint stock price. ADDS details; EDITS to eliminate extraneous "called" in 9th graf.)
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