Weekly Deal Roundup

Sprint Nextel Receives All Regulatory Approvals for iPCS, Inc. Acquisition
From: Sprint
Sprint Nextel today announced that it has received all regulatory approvals needed to complete the acquisition of iPCS. On Nov. 24 the Federal Communications Commission approved the transfer of the spectrum license held by a subsidiary of iPCS. On Nov. 23 the Public Service Commission of West Virginia granted the joint petition of Sprint Nextel and iPCS for prior consent and approval of the acquisition and ownership of iPCS by Sprint Nextel. All other terms and conditions of the previously announced tender offer for all outstanding shares of the common stock of iPCS, which is being conducted through a wholly-owned subsidiary of Sprint named Ireland Acquisition Corporation, remain unchanged. The iPCS board has unanimously recommended that the iPCS stockholders accept the tender offer, tender their shares of iPCS common stock in the tender offer, and if necessary, adopt the merger agreement. The tender offer is scheduled to expire at midnight EST Wednesday, Nov. 25. Following the completion of the tender offer and merger, iPCS will become a wholly-owned subsidiary of Sprint Nextel.
Read the entire press release here.
Sprint completes purchase of Virgin Mobile USA
From: AP
Sprint Nextel on Tuesday said it had completed its $483 million acquisition of Virgin Mobile USA, boosting its presence in the market for customers who pay for cell phone service month-to-month.
Virgin Mobile shareholders earlier Tuesday voted in favor of the acquisition, which was announced in July and pays them $5.50 in Sprint stock for each Virgin Mobile share. The deal also includes retiring roughly $223 million of Virgin Mobile’s debt. Sprint Nextel already owned 13.1 percent of Virgin Mobile, which uses Sprint’s network to offer service and has 5.2 million subscribers. It’s unclear how Virgin and Boost will coexist under Sprint, although they have been geared toward different markets — Virgin aimed at teens and 20-somethings while Boost is considered a value brand. The company said customers of both brands won’t see any immediate changes. Other competitors in the prepaid space include No. 4 carrier T-Mobile USA and smaller upstarts like MetroPCS Communications Inc. and Leap Wireless International Inc., which sells under the Cricket brand.
Read the entire press release here.
U.S. Cellular Announces Redemption of 8.75 Percent Senior Notes
From: PR Newswire
United States Cellular Corporation announced that it will redeem all of its outstanding 8.75 percent Senior Notes due 2032. The $130 million aggregate principal amount of outstanding notes will be redeemed Dec. 24, 2009, at a redemption price of 100 percent of the principal amount, together with accrued and unpaid interest to the redemption date. Additional information will be included in a Form 8-K to be filed with the Securities and Exchange Commission. A notice of redemption with instructions is being distributed to registered holders of the notes.
Read the entire press release here.
Ericsson buys Nortel’s GSM assets in North America
From: RCR Wireless News
Having successfully completed the purchase of Nortel Network’s CDMA and LTE assets, Ericsson announced plans to buy the bankrupt network manufacturer’s GSM assets in the U.S. and Canada for $70 million. Austrian-based Kapsch CarrierComm AG is picking up the rest of Nortel’s GSM business for about $33 million.
The deal, if it meets regulatory and other approvals, will give Ericsson another 350 Nortel employees, as well as contracts with AT&T Mobility and T-Mobile USA Inc. Ericsson will count 14,500 employees after the transaction is finished. “Along with our recent acquisition of Nortel’s CDMA and LTE assets, the transaction emphasizes Ericsson’s commitment to the North American market and strengthens our position as a leading provider of telecommunications technology and services in the United States and Canada” said Hans Vestberg, incoming President and CEO of Ericsson. “Our Ericsson family will be once again enriched by the addition of the valuable Nortel employees.”
Read the entire story here.
Ciena Buys Nortel Assets for $769 Million
From: Wall Street Journal
Ciena Corp. agreed to acquire a Nortel Networks Corp. division that develops networking gear used to transmit data and voice traffic for $769 million in cash and notes. In an auction that started Friday morning, Ciena, based in Linthicum, Md., beat out Nokia Siemens Networks and its partner, private-equity firm One Equity Partners, for the acquisition of Nortel’s Metro Ethernet Networks business. The winning offer consists of $530 million plus $239 million in senior convertible notes. The auction is part of Nortel’s continuing efforts to dismantle itself under bankruptcy protection. The Toronto company filed for bankruptcy protection in January, weighed down by its debt load and the economic slowdown. The Metro Ethernet business reported revenue of $988 million for the first nine months of this year, down 21% from a year earlier, as the struggling economy and Nortel’s bankruptcy filing hurt customer demand for the company’s products. Ciena faces significant integration risks. It has agreed to hire at least 2,000 Nortel employees, or more than 85% of the Metro Ethernet employee base, nearly doubling Ciena’s current work force. Nortel in October agreed to Ciena’s stalking-horse bid, a structure typically used in deals involving companies operating under bankruptcy protection. The bid, valued at $521.7 million, triggered Friday’s auction to ensure the highest price for the Metro Ethernet unit. Ciena’s initial offer included $390 million plus 10 million Ciena shares. The transaction is subject to approval by the U.S. Bankruptcy Court for the District of Delaware and the Ontario Superior Court of Justice. A hearing is scheduled for Dec. 2. The Canadian government could also review the transaction under the Investment Canada Act to determine if it represents a net benefit to the country.
Read the entire story here.
Clearwire lands $1B+ in additional funds
From: RCR Wireless News
Clearwire Corp. bridged a potential funding gap announcing plans to raise $920 million through the offering of 12% senior secured notes due in 2015. In addition the carrier said it closed on a $1.852 billion offering of 12% senior notes due in 2015 that will be used to pay off $1.4 billion of existing debt, leaving Clearwire with approximately $360 million of additional funding.
Read the entire story here.
Mobile TV Chip Maker Telegent Plans to Raise $250M In IPO
From: The Alarm Clock
With Wall Street raging full on in bull mode, IPOs tech are lining up. Sunnyvale-based Telegent Systems filed for an IPO with plans to raise up to $250M on the Nasdaq as TLG. Telegent is backed by New Enterprise Associates, Walden International, ad Index Ventures, among others. It has raised $50M in three rounds, including a $20M round announced August 2007. Telegent said it had net income of $40.8M on revenues of $123.87M in its fiscal year ended March 31, 2009, and net income of $39.3M on revenues of $111.1M
for the six months ended September 30, 2009. Telegent chips are designed to deliver live broadcast
TV on very small screens. The company says its technology is integrated into more than 50M handsets globally. The starup is led by Weijie Yun Executive Chairman of the Board and Co-Founder as well as his Co-Founder Samuel Sheng, who is CEO and CTO. Telegent’s direct competitors are companies like DiBcom , Frontier Silicon, and Siano Mobile Silicon and most notably Qualcomm and its MediaFLO technology.
Read the entire story here.
Inmarsat Acquires U.S. Government Services Provider
From: Satellite Today
Inmarsat has acquired government and military Internet protocol managed solutions and services provider, Segovia, along with the company’s assets, Inmarsat announced Nov. 23. Inmarsat will initially pay $110 million with cash on hand and has structured the deal to possibly pay additional amounts depending on Segovia’s future performance over the next three years. Segovia executive management will operate Segovia as a separate business reporting to Stratos CEO and President Jim Parm. Stratos is Inmarsat’s direct distribution business. The transaction is expected to close in early 2010.
Read the entire story here.
Windstream Gobbles Iowa Telecom for $1.1B
From: Reuters
Windstream Corp. is making its fourth acquisition of 2009 with the $1.1 billion stock-and-cash purchase of Iowa Telecommunications Services. Iowa Telecom’s stock shot up almost 25 percent in mid-morning trading, while Windstream’s shares faltered about 1 percent on the news. Windstream will give Iowa Telecom shareholders about 26.5 million shares of stock valued at around $269 million, and pony up another $269 million in cash. Then, Windstream also will repay net debt of approximately $598 million. Windstream said it will save up to $35 million in operating and capital expenses thanks to the Iowa Telecom buy. Iowa Telecom serves residential and business users in Iowa and Minnesota. The company has approximately 256,000 access lines, about 95,000 high-speed Internet subscribers and about 26,000 digital TV customers. Iowa Telecom operates approximately 11 access lines per square mile across its service areas, and claims a fiber and IP network. In addition to those assets, Windstream also will own Iowa Telecom’s 15 FCC Advanced Wireless Service licenses and three 700MHz band licenses. Earlier this month, Windstream forked out $643 million for CLEC NuVox Inc. to expand its small business reach. Once all of the purchases are complete, Windstream expects to report about $4 billion in annual revenue. Both companies’ boards have approved the acquisition. Windstream didn’t say whether it will keep Iowa telecom’s 800 workers, although it did say it will maintain operations in Iowa Telecom’s Newton headquarters and will expand the call center there.
Read the entire story here.
US email marketing software company ExactTarget raises a further $70m
From: AltAssets
Indianapolis email marketing software solutions company ExactTarget has raised $70m in venture funding, according to a filing submitted to the US Securities and Exchange Commission. The company said that US venture firm Technology Crossover Partners had made an investment, but did not say if existing backers had participated in the round. The investment follows a previous $70m round of funding in May this year, led by Battery Ventures and including Scale Venture Partners and a repeat investment by Montagu Newhall. ExactTarget provides companies with a single software to market to customers via triggered and transactional mail, text messaging and social media.
Read the entire story here.
Roam Data lands $6.5M in Series B round
From: Mass High Tech
Mobile software company Roam Data Inc. has closed on $6.5 million in second round funding from Ingenico Ventures, the investment arm of French company Ingenico SAS, along with private investors including payment industry veteran George Wallner, founder and former CEO of Hypercom. Boston-based Roam Data makes a mobile software development platform that enables the creation of transaction processing applications for any smart phone or feature phone on any network. According to Will Graylin, chairman and CEO of Roam Data, the company’s mobile commerce services are now being launched by payment processing firms like First Data and Chase Paymentech, and it is supported on all major mobile carriers in the United States, including Sprint, AT&T, Verizon, and T-Mobile. The target market for Roam’s initial solutions include mobile professionals and micro-merchants, such as outdoor salespeople, plumbers or electricians, as well as enterprises with fleets of delivery drivers and installers.
Read the entire story here.
Finland awards 2.6GHz licences for LTE
From: TelecomPaper
Finland has awarded licences in the 2.6GHz band for offering LTE mobile services. Finnish mobile operator Elisa said it was allocated 50 MHz during the auction, which was run by the regulator Ficora and ended on 23 November. The licence is valid until 2029 and comes with a fee of EUR 834,700, the company announced. Sonera also acquired a 20-year licence for five blocks of 2×5 MHz in the 2.6GHz band, for EUR 819,000. The company expects to connect its first customers over the LTE network in the first quarter next year, while network roll-out will depend on customer demand and the availability of compatible end-user equipment. Finland’s other major network operator, DNA also confirmed it was awarded frequencies of 40MHz, for EUR 675,700. DNA plans to launch mobile broadband at up to 21Mbps in the next few months, using HSPA+ technology, and expects the new spectrum will help it boost speeds to 100Mbps. The government raised in total EUR 3.8 million from the auction. Another 50 MHz of TDD spectrum went to Pirkanmaan Verkko, which bid EUR 1.5 million for the spectrum for the Finnet alliance of local operators.
Read the entire story here.
Deutsche Telekom seeks partner in U.S. – report
From: Reuters
Deutsche Telekom, Europe’s largest telecoms company, is looking for a partner for its U.S. mobile communications business, German paper Handelsblatt reported, citing unidentified people from the German company. Deutsche Telekom wants the partner to help finance billions of euros of investment in networks that offer fast data transfers, Handelsblatt reported.
Possible partners include competitors MetroPCS, Clearwire, and AT&T and companies from outside the industry such as a financial investor, the German paper said. As part of a partnership with a financial investor, the investor might take a stake in Deutsche Telekom’s U.S. unit, Handelsblatt reported.
The company is still in the initial stages of the search for a partner but, for the time being, has abandoned other potential strategies to bolster its U.S. business, the people said, according to the paper. The German company is no longer considering a share sale and a takeover of rival Sprint-Nextel, unidentified people from within Deutsche Telekom’s management said, Handelsblatt reported. T-Mobile USA, ranked a distant No.4 position in the U.S. mobile market, has been losing ground to bigger companies like Verizon Wireless and AT&T Inc as well as smaller companies like Leap Wireless and MetroPCS.
Read the entire story here.
Moody’s cuts Sprint-Nextel rating, citing e
arnings
From: Reuters
Moody’s Investor Services on Friday cut its credit rating fo
r Sprint-Nextel Corp (S.N), citing concerns about Sprint’s ability to stabilize its operating performance and earnings.
Moody’s downgraded the company one notch to Ba2, which is the second highest “junk” rating, from Ba1. The outlook on the rating is negative, meaning the agency may downgrade Sprint at some point in the next 18 months. The downgrade “reflects the company’s continuing challenges in stabilizing its post-paid wireless operations, despite recognized improvements in customer service, amid intense competition and slowing industry growth,” said Moody’s analyst Dennis Saputo in a report. Moody’s said that AT&T and Verizon Communications pose the greatest threat to Sprint’s efforts to thwart defections from its highly profitable post-paid subscriber business.
Read the entire story here.
Motorola buys base station unit from RadioFrame
From: AP
Motorola Inc. said Friday that it has purchased the base station business of RadioFrame Networks Inc., which uses a technology that allows walkie-talkie features on cell phones. Terms of the deal were not disclosed. The technology, called Integrated Digital Enhanced Network, or iDEN, allows cell phone calls to travel on the same network as communication from two-way radios, faxes and pagers. It is used by carries such as Sprint Nextel. Motorola created the iDEN technology, which RadioFrame licensed for its base station products. These base stations are placed in cell towers that route mobile phone calls. While Motorola also makes its own base stations, it purchased RadioFrame’s base stations because these use less power and are less costly for carriers to use. Motorola said RadioFrame’s base station business will be folded into its Home and Networks mobility unit. Shares of Motorola were down 21 cents, or 2.5 percent, to $8.27 in morning trading.
Read the entire story here.
picoChip attracts $20 Million investment to accelerate growth
From: Design & Reuse
picoChip today announced that it has completed a $20 million funding round. Already the dominant supplier for femtocell silicon, supporting all the major HSPA carrier deployments, this additional investment will help picoChip extend its leadership and grasp the growing market opportunity in the femtocell sector. picoChip’s investors include financial investors, Atlas Venture, Highland Capital Partners, Pond Venture Partners, Scottish Equity Partners, and Rothschild plus strategic investors AT&T, Intel and Samsung. This fresh injection of capital from top tier VCs and institutional investors comes at a time when technology VC investment has decreased markedly, with backers choosing their investments carefully and only the strongest companies able to secure finance. ABI Research forecasts the total available femtocell market in 2010 will reach 2.3 million units, rising to 40 million units in 2014. In 2009 six major network operators have launched femtocell services that cover the USA, Europe and Asia. Having been the first to market with a femtocell solution in 2005, picoChip is clearly the leading technology supplier for carrier’s HSPA rollouts, with seventeen customers using the field-proven picoXcell™ product. The company today also announced its strategy for an end-to-end femtocell reference solution that will lower barriers to entry, minimize cost and accelerate time-to-market for femtocells.
Read the entire story here.