Sprint Nextel is set to buy one of its wireless affiliates for an estimated $3.4 billion in a move to settle outstanding breach of contract issues following Sprint's acquisition of Nextel. The acquisition of Alamosa Holdings is worth a total of $4.3 billion, including $900 million in net debt. Alamosa shareholders will receive $18.75 per share in cash as a result of the acquisition. Alamosa claims to be the largest Sprint Nextel affiliate with 1.48 million direct wireless subscribers. Alamosa shareholders still must approve the acquisition. If the deal goes through, Sprint will have acquired 2.3 million Sprint PCS affiliate subscribers.
In August Alamosa filed a complaint against Sprint Nextel over breach of contract agreements the carrier had allegedly violated following the merger with Alamosa's subsidiary AirGate. Sprint is still in court with affiliate Nextel Partners, which the carrier must also buy. The acquisition is still stuck in the valuation process.