Word from The Wall Street Journal is that the former Chairman of Sprint (S) would like to come back to the company as CEO. Tim Donahue, who had been CEO of NexTel before it was bought by Sprint, had a $5 billion truck of money to offer along with his services.
WSJ writes that Sprint’s (S) board was given an "offer by South Korea’s SK Telecom and private equity firm Providence Equity Partners to invest $5 billion in the company." Mr. Donahue was part of the package.
The Sprint board turned the deal down cold, even though the investment would have been in the form of a security convertible into common shares at a price 15% to 20% above the current level of $15.20.
SK Telecom has already deployed some WiMax technology in its home market of Korea. Sprint has been working on a US network based on the same infrastructure.
The last thing the Sprint board needs to do is bring back one of the senior management people responsible for the train wreck known as the NexTel merger. The company’s shares are down almost 45% over the last two years compared to a 19% increase in the S&P.
Donahue has some substantial level of responsibility for the disaster. He was the Chairman, after all.
Douglas A. McIntyre