After two years of storm and stress, Nextel Communications Inc. is putting finishing touches on its enhanced specialized mobile radio network and ownership structure-but one early backer has decided to cash out.
Nextel said it has received stockholder approval to complete its pending transactions with Motorola Inc., OneComm Corp. and Craig McCaw. The company already had reported receiving consent from its bondholders to close the deals.
“With the approval of these transactions, we’re one step closer to realizing our goal of developing a nationwide digital wireless communications network serving teams of mobile workers,” said Nextel Chairman Morgan O’Brien.
Comcast Corp.-which had acquired nearly 11 percent of the company early on but which has been winding down its participation lately-sold its approximately 11.3 million Nextel common shares.
The company earlier had voiced concern about the viability of Motorola Inc.’s Integrated Dispatch Enhanced Network technology that Nextel depends on and about the company’s strategic direction. Comcast requested Nextel file a shelf registration statement so it would have the option of selling its interest (RCR, June 5, p.31).
The secondary registration became effective June 29 and Comcast disposed of its stake in Nextel for $18.875 a share.
In connection with the transaction, Nextel said it expects to receive about $20 million plus accrued interest in accordance with terms applicable to a note issued by a Comcast affiliate for options originally issued in September 1992.
Nextel received a needed credibility boost earlier this spring when cellular pioneer Craig McCaw announced his family would buy up to $1.1 billion in Nextel stock and take a seat on its board to help provide strategic direction. Motorola will sell some of its Nextel shares to McCaw in order to focus on its role as provider of the iDEN digital technology.
“As we focus on operations and continuing technical development during the transition, we appreciate the assurances we’ve received from the highest levels at Motorola and their commitment to improve the technology,” O’Brien said.
In related news, Nextel announced it has begun providing its digital service to work groups in Philadelphia and throughout southeastern Michigan, including Detroit, Lansing, Bay City and Ann Arbor, as well as Toledo, Ohio.
“As two of the largest markets in the country, the Philadelphia and Detroit metropolitan areas are an important addition to Nextel’s network,” said Nextel’s Chief Executive Officer Wayland Hicks. The company announced having 37,000 digital mobile units in service at the end of June.
