SoftBank can check off one more item on its to-do list in its mission to acquire Sprint Nextel (NYSE: S ) . On Thursday, the Japanese telecom announced the Securities and Exchange Commission gave its OK for Sprint to begin mailing proxy materials to shareholders regarding the upcoming vote on the transaction.
That vote will be held June 12 at a special shareholders' meeting, and it goes without saying (but I am saying it anyway) that SoftBank will be encouraging Sprint investors to vote for the proposal.
But the SEC thumbs up was just a small barrier compared to what SoftBank will have to scramble over before it can close on the deal.
DISH Network (NASDAQ: DISH ) announced two weeks ago that it, too, wanted to buy Sprint, offering $25.5 billion compared to the $20.1 billion SoftBank bid. SoftBank's challenge will be to convince the Sprint shareholders that the DISH offer is less than what it seems.
That process began earlier this week when SoftBank CEO Masayoshi Son held a press conference in Tokyo questioning the veracity of DISH's claim that its offer would be worth $7 a share. "I would say the number is wrong. Totally wrong. It is incomplete and illusory," Son said.
10 Best Sliver Stocks To Own Right Now: CenturyLink Inc.(CTL)
CenturyLink, Inc., together with its subsidiaries, operates as an integrated communications company. The company provides a range of communications services, including voice, Internet, data, and video services in the continental United States. Its services include local exchange and long distance voice telephone services, as well as enhanced voice services, such as call forwarding, caller identification, conference calling, voicemail, selective call ringing, and call waiting; wholesale local network access services; and data services, including high-speed Internet access services, data transmission services over special circuits and private lines, and switched digital television services, as well as special access and private line services. The company also offers fiber transport, competitive local exchange carrier, security monitoring, and other communications, as well as professional and business information services. In addition, it provides other related services, such as leasing, selling, installing, and maintaining customer premise telecommunications equipment and wiring; payphone services; and network database services, as well as participates in the publication of local telephone directories. Further, the company offers printing, direct mail services, and cable television services; and wireless broadband Internet access services and satellite television services. As of December 31, 2010, it operated approximately 6.5 million telephone access lines. CenturyLink, Inc was founded in 1968 and is based in Monroe, Louisiana.
Advisors' Opinion:- [By Brian Nichols]
Rackspace Hosting Inc. (NYSE: RAX ) takeover talks are heating up as analysts believe that CenturyLink (NYSE: CTL ) has a high probability of making a bid. While this might make sense as a way to better compete against companies like Amazon.com (NASDAQ: AMZN ) , is this really in the best interest of shareholders?
- [By Laura Brodbeck]
Next week investors will be waiting for several key earnings reports including�Tesla Motors, Inc. (NASDAQ: TSLA), Time Warner Inc. (NYSE: TWX), CenturyLink, Inc. (NYSE: CTL), Groupon, Inc. (NASDAQ: GRPN)
- [By Ben Levisohn]
Shares of CenturyLink (CTL) have dropped more than 2% today on reports that it’s trying to buy cloud-computing company Rackspace Hosting (RAX).
ZUMAPRESS.comBloomberg has the details on the potential transaction:
CenturyLink has discussed the idea with San Antonio-based Rackspace, which last month said it is still conducting an internal review of its strategic options, according to the people, who asked not to be identified talking about private information. One person said a deal may not be reached for the company, which had a stock-market valuation of $5.33 billion at the end of last week.
Citigroup’s Michael Rollins thinks a deal will depend on valuation:
Valuation matters. We believe CenturyLink can financially digest a possible acquisition of Rackspace under $50 per share based on our scenario analysis. We believe�CenturyLink could pay for�Rackspace using up to 50% in cash to keep net debt financial leverage near or below 3x on our pro forma analysis. While PF FV/OIBDA may not move substantially paying up to $50/share, we estimate FCF/share and norm. EPS could be diluted by up to (11%) in the first year. Based on our initial analysis, we would take a neutral view for a possible buyout under $40 per share, but believe�CenturyLink shares could trade lower if it were to pay more than $50 for Rackspace. We remain Neutral on CenturyLink largely based on valuation.
Shares of CenturyLink have dropped 2.2% to $40.55 at 1:18 p.m., while Rackspace has gained 5% to $39.10.
- [By Selena Maranjian]
Douglas C. Lane reduced its stake in lots of companies, including telecom company CenturyLink (NYSE: CTL ) . The company sports a tempting 6% dividend yield, and that's after it cut its payout by about 25%, in part to focus more on share buybacks. The company landed a hefty Pentagon contract in April, with a possible 10-year value of $750 million and has been moving into promising arenas such as cloud computing (via its purchase of SAVVIS). CenturyLink carries more than $19 billion in debt, but it's also generating significant free cash flow, near $3 billion annually. Its revenue growth has been accelerating in recent years and has long been in double digits annually.
Top 5 Telecom Companies To Own In Right Now: Chorus Ltd (CNU)
Chorus Limited maintains and builds a network made up of local telephone exchanges, cabinets and copper and fiber cables. The Company has approximately 32,000 kilometers of fiber and 130,000 kilometers of copper cabling. These cables connect back to local telephone exchanges. Chorus fiber also connects mobile phone towers owned by mobile service providers. About 7,000 cabinets provide interconnection points for around 50% of the lines in its network. A range of these cabinets are mini telephone exchanges and have electronic broadband equipment installed in them. In some cases, retail service providers have chosen to install their own broadband equipment in an exchange and pay the Company for the rental of the access line. It offers a range of products delivered over its copper network and new products designed to provide access to the ultra-fast broadband (UFB) fiber network. Advisors' Opinion:- [By Holly LaFon]
Watsa sold two stocks in the fourth quarter: Continucare Corp. (CNU) and First Place Financial Corp. (FPFC). He reduced Dell (DELL), one of his largest holdings, but almost 60%.
Top 5 Telecom Companies To Own In Right Now: T-Mobile US Inc (TMUS)
T-Mobile US, Inc., formerly MetroPCS Communications, Inc., incorporated on March 10, 2004, is a wireless telecommunications carrier, which offers wireless broadband mobile services primarily in metropolitan areas in the United States, including the Atlanta, Boston, Dallas/Fort Worth, Detroit, Las Vegas, Los Angeles, Miami, New York, Orlando/Jacksonville, Philadelphia, Sacramento, San Francisco and Tampa/Sarasota metropolitan areas. Its flagship brands include T-Mobile and MetroPCS. As of December 31, 2012, it held licenses for wireless spectrum suitable for wireless broadband mobile services covering a total population of 144 million people in and around many of the metropolitan areas in the United States. It provides its services using code division multiple accesses (CDMA) networks using 1xRTT technology and evolution data optimized (EVDO) and fourth generation long term evolution (4G LTE).
The Company has roaming agreements with other wireless broadband mobile carriers that allow them to offer its customers service in many areas when they are outside its service area. These roaming agreements, together with the area it serve with its own networks, allows its customers to receive service in an area covering over 280 million in total population under the Metro USA brand. The Company sells products and services to customers through its Company-owned retail stores, as well as indirectly through relationships with independent retailers and third party dealers. Its service allows its customers to place unlimited local calls from within its local service area and to receive unlimited calls from any area while in its service area, for a flat-rate monthly service fee. For additional usage fees, it also provide certain other value-added services. All of these plans require payment in advance for one month of service. If no payment is made in advance for month of service, service is suspended at the end of the month that was paid for by the customer and, if the customer does not pay within 30 day! s, the customer is terminated. It believes its service plans differentiate them from the more complex plans and long-term contract requirements of traditional wireless carriers.
The Company voice services allow customers to place voice calls to, and receive calls from, any telephone in the world, including local, domestic long distance, and international calls. Its voice services also allow customers to receive and make calls while they are located in areas served by its networks and in those geographic areas served by the networks of certain other wireless broadband mobile carriers with whom it has roaming arrangements. The Company�� data services include text messaging services (domestic and international); multimedia messaging services; mobile Internet access; mobile instant messaging; location-based services; social networking services; push e-mail; multimedia streaming and downloads; and services provided, depending on the network and locale, through the Binary Runtime Environment for Wireless, or BREW, Blackberry, Windows, and the Android platforms, such as ringtones, ring back tones, games, content, and applications.
The Company�� Custom calling features offers custom calling features, including caller ID, call waiting, three-way calling and voicemail. Its Advanced handsets sells a variety of feature phones, and increasingly, smartphones, predominately manufactured by nationally recognized manufacturers for use on its network, including models that have cameras, include HTML browsers, play music, play streaming audio, display streaming video and downloaded video, and have other features facilitating digital data. It sells a variety of handsets using vendor or handset specific operating systems, such as BREW, Blackberry, Windows, and the Android operating system.
The Company provides its wireless broadband mobile services using paired personal communications services (PCS), spectrum and advanced wireless services, or AWS, spectrum. In addition, it holds a! license ! for 12 MHz of paired 700 MHz Lower Band A spectrum in the Boston-Worcester, MA/NH/RI/VT basic economic area (BEA), which, unless it receives a waiver from the Federal Communications Commission (FCC), of the four year construction requirements, it plans to construct in the first half of 2013. In each of its metropolitan areas where irt provides service. As of December 31, 2012, it holds between 10 mega hertz (MHz) and 60 MHz of paired spectrum and on average it has approximately 22 MHz of paired spectrum in the metropolitan areas it serves. In the aggregate, as of December 31, 2012, it offers wireless broadband mobile services using its own network.
The Company operates 1xRTT CDMA networks in all of the metropolitan areas it serves and it has upgraded its networks to 4G LTE in all of metropolitan areas. It also has deployed EVDO at selected high use sites in its CDMA network to increase network data capacity to meet the growing data needs of iy customers. Its network includes a mobile switching center (for CDMA), enhanced packet core (for 4G LTE), and IP core. These serve several purposes, including routing traffic, managing call handoffs, and managing access to the public switched telephone network (for CDMA) or the Internet (CDMA and 4G LTE). These network elements also provide access to voicemail and other value-added services, base stations (for CDMA) or eNodeBs (for 4G LTE), cell sites or distributed antenna system (DAS), nodes, and backhaul facilities, which carry traffic to and from its cell sites and its switching or enhanced packet core facilities, consisting of a combination of dedicated circuits, cable, fiber, and microwave facilities.
Its cell sites in the network are co-located, meaning its equipment is located on leased facilities that are owned by third parties who retain the right to lease the locations to additional carriers and in many cases other wireless broadband mobile service providers already have facilities at such locations. The switching centers and na! tional op! erations center provide around-the-clock monitoring of its network. Its switches connect to the public switched telephone network through fiber rings leased from third-parties, which transmit originating and terminating traffic between its equipment and local exchange and long distance carriers. It also has negotiated interconnection agreements with relevant local exchange carriers, or LECs, in its service areas. It uses third-party providers for domestic and international long distance services, international SMS interconnection with the public switched network and other carriers, roaming services, and the majority of its backhaul services.
The Company competes with AT&T, Verizon Wireless, Sprint Nextel, T-Mobile USA , Deutsche Telekom, Clearwire, Dish Network , Time Warner Cable, Comcast, Cox Communications, Cricket Communications, Leap Wireless International and Google.
Advisors' Opinion:- [By Chris Neiger]
T-Mobile (NYSE: TMUS ) is often in the limelight, and this week was no different. At its latest Un-carrier 8.0 event, the company made two big announcements. First is the new Data Stash program that allows subscribers to rollover unused data for use at a later date. And second is the expansion of the company's LTE connections.
- [By Tess Stynes]
Sprint is working toward a possible bid for rival T-Mobile US Inc.(TMUS), the Wall Street Journal reported, setting the stage for a telecom merger that if permitted by regulators would leave the U.S. wireless market dominated by three big companies. Sprint is studying regulatory concerns and could launch a bid in the first half of next year, the Journal reported. Sprint shares were up 4% to $8.77 premarket and T-Mobile was down 14 cents at $27.50. American depositary shares of Deutsche Telekom AG(DTE.XE), which holds a majority stake in T-Mobile, were up 2.8% at $16.05.
- [By Adam Levy]
This is bad news for the four major U.S. carriers --�AT&T (NYSE: T ) , Verizon (NYSE: VZ ) , T-Mobile U.S. (NYSE: TMUS ) , and Sprint (NYSE: S ) . While the first three continue to add postpaid phone subscribers, all are heavily reliant on smartphone subscribers to increase average revenue per subscriber.
- [By Sam Mattera]
The U.S. wireless industry is in the midst of a tectonic shift: Brought on by T-Mobile's (NYSE: TMUS ) aggressive "Un-carrier" strategy, smartphone subsidies are on the decline, and the once-dominant two-year contract model appears to be falling by the wayside.
Top 5 Telecom Companies To Own In Right Now: Iliad SA (ILD)
Iliad SA is a France-based holding company active in the integrated telecommunications sector. The Company provides Internet access services, hosting services and others. Iliad SA is also focused on fixed-line telephony services and the provision of wireless fidelity (WiFi) cards, among several others. In addition, Iliad SA sells via Internet a range of insurance policies. As of December 31, 2012, the Company had a number of subsidiaries, which include Free SAS, Centrapel SAS, Freebox SAS, Telecom Academy SARL, Free Frequences SAS, Iliad 1 SAS, Iliad 2 SAS, Protelco SAS, IFW SAS, IRE SAS, Management Centre De Relation Abonne (MCRA), F Distribution SAS, and Centrapel SAS, among others. Its Fixe subsidiary is a landline business-provider of broadband Internet services. As of year-end 2012, the Company was active as a operator in more than 35 countries. Advisors' Opinion:- [By Patricio Kehoe]
In order to counter the aggressive pricing strategy from wireless new entrant Iliad SA (ILD) in France, Orange was forced to reduce prices. Thus, the firm has continued to add wireless subscribers but at a lower average revenue per user, mainly through its low-end Sosh brand.
- [By Marie Mawad]
Sales and earnings at Orange are falling as domestic competition with rivals including discounter Iliad SA (ILD) weighs on prices. The carrier, which has diversified into countries from Poland to Egypt, is also trying to keep a lid on debt.
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