Sprint CEO Dan Hesse is reportedly set to leave the nation’s No. 3 carrier as soon as tomorrow, in a move that coincides with a plan to abandon its attempt to acquire smaller rival T-Mobile US.
Bloomberg News is reporting that Sprint was set to name a new CEO as soon as Wednesday in a shakeup of the carrier that has seen numerous shakeups since being acquired by Softbank last year. The report cites an unnamed source.
The Bloomberg report followed one by The Wall Street Journal claiming that Sprint was set to abandon a planned offer to acquire T-Mobile US, citing significant regulatory hurdles. Although Sprint never made an official bid for T-Mobile US, the carrier on Wednesday is reported to be making an announcement that it will not pursue an offer. Sprint is scheduled to hold its annual investor meeting on Aug. 6.
Hesse, who has been at the helm of Sprint for more than six years, reportedly was set to pocket a $49 million compensation package for 2013, despite the carrier’s continued operational struggles. That package was being protested by Institutional Shareholder Services, which claimed the package was excessive and not tied to operational performance, though Sprint claimed 2013 was a “transformational” year for the carrier. That transformation included the acquisition by Softbank, Sprint’s purchase of the remaining stake in Clearwire that it did not already own, the shut down of its legacy iDEN operations and the announcement of its Spark network initiative.
Sprint has seen a number of executives shown the door over the past 12 months, across both its marketing and network operations. Those changes followed Softbank Chairman Masayoshi Son taking over the same position at Sprint. Son has aggressively tried to import his aggressive management style of Softbank into Sprint, which sources have told RCR Wireless News has caused serious consternation among Sprint employees.
Sprint last week reported quarterly financial results that showed continued struggles in terms of customer metrics, though the carrier did manage to squeak out a profit.
T-Mobile US deal dead?
While Sprint never officially acknowledged plans to make a bid for T-Mobile US, rumors of such a move have been rampant. Reports recently indicated that Softbank had in place a $45 billion package to acquire Deutsche Telekom’s controlling stake in T-Mobile US and set aside up to $10 billion for a joint bidding venture in the upcoming 600 MHz incentive spectrum auction. However, the Federal Communications Commission has aggressively made comments and announced proposed changes to both auction rules and its internal spectrum screen designed to thwart a potential Sprint/T-Mobile US merger.
T-Mobile US’ future was further put into question late last week following an acquisition offer put forth by French operator Iliad that DT has reportedly shot down. Iliad is now reportedly talking to investors about increasing its bid.
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