Sprint taps Brightstar founder to take the helm as T-Mobile merger falls through

sprint storefront brand logoThey may garner plenty of headlines, but BlackBerry Ltd. and Hewlett-Packard Co. aren’t the only tech titans trying to recover some of their former glory. Sprint Corp. is also  moving aggressively to reverse its declining revenues, and as we’ve recently learned, it will be going at it entirely alone – under new leadership, at that.

The struggling carrier has officially shelved plans to merge with smaller rival T-Mobile US Inc. this week, ending months of drawn-out negotiations that raised concerns among both analysts and regulators. The Federal Communications Commission (FCC) and Department of Justice have been especially vocal in their opposition to the deal, arguing that further consolidating in the telecommunication industry could negatively affect consumers.

It was that pressure that eventually led to the merger falling through, the Wall Street Journal cited an unnamed insider as saying. Had the companies attempted to push through with the transaction, they would have likely come up against the same legal obstacles that blocked AT&T from completing its own attempt at acquiring T-Mobile USA in 2011. Management already decided that the hassle wouldn’t be worth it by mid-July, according to the report.

With a merger off the table,  Sprint will now be turning its full attention inward to unwind a corporate tangle. The effort will be spearheaded by newly appointed president and chief executive officer Marcelo Claure, a former director. He is taking over the reins from Dan Hesse, who took the helm in December 2007 and led the carrier through a number of key acquisitions, most notably the $21.6 billion merger with Japanese telecom giant SoftBank Corp. last July.

Claure is joining Sprint from Brightstar Corp., which he founded in 1997 as a car-trunk phone selling operation and single-handedly grew it into global  distribution with annual revenues estimated to be in the tens of billions of dollars. SoftBank acquired a 57 percent stake in the privately held Miami, FL-based company last October for $1.2 billion, and is set to buy Claure’s remaining interest after he steps into his new position with Sprint on Monday.

The Bolivian entrepreneur and former professional soccer coach said in a statement that he will focus on ”becoming extremely cost efficient and competing aggressively in the marketplace,” which can be taken to mean that cutbacks are on the horizon for Sprint’s 35,00-strong workforce. But Claure indicated that he will hold off on consolidation for the foreseeable future and instead concentrate the company’s resources to drive sales growth.

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