Suspicion is growing that Sprint is considering going the way of Motorola and looking to amputate part of their business, with many believing that troubled purchase Nextel are most likely to be spun off.  According to Seeking Alpha, the carrier has hired Morgan Stanley to manage the sell-off, having suffered two years of poor performance since acquiring Nextel in 2006.  Late in February Sprint was forced to freeze dividends as subscriber losses were predicted at 1.2-million in the quarter and losses soared to almost $30bn.  In response, the share price plummeted by 13-percent to a five-year low.  Seeking Alpha believe an announcement will come in 2-4 weeks, but other sources suggest a more encompassing sale is on the cards.

The analyst firm Merrill Lynch is suggesting that Deutsche Telecom, the parent company of T-Mobile and sixth-largest carrier in the world, is considering buying both Sprint and Nextel so as to prevent the CDMA carrier from further cutting their prices (Sprint recently announced the US’ best, most feature-inclusive $100 ‘Unlimited’ deal) and sparking off a price-war in which T-Mobile might stand most to lose. 

“In such a price war scenario, we think T-Mobile would face the most pressure, and Deutsch Telecom would see the increased urgency to drive market repair” Merrill Lynch report

A weak dollar and crashing share price makes such a takeover viable.

[via Crave]