Sprint Corp. announced that its proposed spinoff to shareholders of its cellular unit has been ruled a tax-free transaction by the Internal Revenue Service.
Holders of Sprint common stock as of Feb. 27 will receive one share of new stock in the spinoff cellular company, 360 Communications Co., for every three shares held of Sprint common stock, Sprint said. No fractional shares will be issued, with shareholders receiving cash in lieu of fractional shares. Sprint said stock certificates are expected to be mailed to record holders of Sprint common stock on March 7.
Sprint said the spinoff enables it to comply with Federal Communications Commission requirements regarding market overlaps between Sprint’s cellular operations and markets to be served by wireless personal communications services offered through the Sprint Telecommunications Venture.
360 Communications will be the nation’s second largest pure-play cellular company, providing wireless voice and data service to more than 1.5 million customers in 87 markets in 14 states, Sprint said.
