Sprint Nextel said on Monday its board has approved a third-quarter dividend of 2.5 cents a share and set expectations for its local telephone business to have about $7.25 billion in debt.
The No. 3 U.S. wireless company, which plans to spin off Sprint's local phone business, said it set the dividend at a level consistent with the aggregate amount of dividends it expects its local business to pay after the spin-off.
Sprint, which on Friday completed its purchase of Nextel Communications, had previously paid quarterly dividends of 12.5 cents a share.
The company said it sees the local unit, which it expects to spin off in the next nine to 12 months, paying annual dividends of $300 million, reports Reuters.
According to Washington post, the combined company's stock begins trading on the New York Stock Exchange, on Monday, under the symbol S, which was the single-letter symbol for Sears, Roebuck and Co. before Sears was acquired by Kmart Holding Corp.
And also on Monday, the corporate headquarters officially moves to Reston - though many of the Sprint executives who are coming to town are still in transition, and the company's operational headquarters will remain in Overland Park, Kan., a suburb of Kansas City. This is the end of the road for what has been one of the region's best-performing technology stocks, at least over the past three years. After surviving the telecommunications crash - which knocked its shares from almost $80 to under $3 - Nextel stock climbed from a low of $2.78 a share three years ago to $33.32 when the stock stopped trading on Friday.
The local telecommunications business has about 7.5 million local access lines in 18 states and as of June 30 had revenue of more than $6 billion during the prior 12 months.
As previously announced, Tim Donahue, Nextel's president and chief executive, will become chairman of the new company. Gary D. Forsee, Sprint's chairman and chief executive, will be Sprint Nextel's chief executive and president.
Existing customers will continue with their current services and plans the companies said, informs Cellular-News.