Sprint( FON) is settling some legal hassles with a $1 billion buyout.
The Overland Park, Kan., telco says it has agreed to acquire
for $6.25 a share in cash. It will also assume $266 million of its affiliate's net debt, putting a total price tag of $1.3 billion on the transaction.
Agreeing to the takeover, U.S. Unwired will drop its lawsuit against Sprint. Last month, U.S. Unwired charged that Sprint's pending merger with
( NXTL) would create competition in several markets where the company had exclusive rights to sell Sprint service.
Sprint has several regional affiliates that operate separately selling service under the Sprint name. Though U.S. Unwired was the only affiliate suing Sprint, some observers wondered if other buyouts would be forthcoming.
Judging by the official comments, it looks like Sprint would like to keep its affiliate structure unchanged.
"While we decided to acquire a direct ownership interest in these assets, we continue to value our relationship with other affiliates providing Sprint services," said Sprint CEO Gary Forsee in a press release Monday.
A Sprint representative declined to comment on whether other buyouts were planned but said, "We are engaged in ongoing discussions with our other affiliates."
Sprint shares rose 19 cents to $25.57, and U.S. Unwired was unchanged at $6.16 in early trading Monday.