Interesting blurb below from Reuters: Activist investor turns attention to Sun, and others. Best, Mark
Activist investor Whitworth quits Sprint's board
Fri Oct 24, 2008 5:25pm EDT
NEW YORK, Oct 24 (Reuters) - Activist investor Ralph Whitworth has stepped down from Sprint Nextel Corp's (S.N: Quote, Profile, Research, Stock Buzz) board to look at other opportunities, amid concerns that a turnaround at the No. 3 U.S. wireless service may take longer than expected due to the economic slump.
Sprint said that Whitworth, the principal of investment advisor Relational Investments LLC which owns about 1.9 percent of Sprint, would be replaced by Sven-Christer Nilsson, a former Ericsson (ERICb.ST: Quote, Profile, Research, Stock Buzz) executive.
Shares of the company fell 9 percent in a broad market downturn on Friday. Sprint, which has struggled to stem customer losses due to network and customer service problems, has lost 63 percent of its market value since early September.
"Now is the appropriate time for me to step down from the Sprint board," Whitworth said in a statement. "The company is taking the necessary steps to improve performance, and while I expect it will take time, Sprint is on the right track to turn around the business."
A person familiar with the investment strategy of Relational Investments, Sprint's 14th largest institutional shareholder with 53 million shares, said the investment fund is turning its attention to other companies such as Sun Microsystems Inc (JAVA.O: Quote, Profile, Research, Stock Buzz) Yahoo Inc (YHOO.O: Quote, Profile, Research, Stock Buzz) and International Rectifier Corp (IRF.N: Quote, Profile, Research, Stock Buzz).
"Near term it's going to be a difficult road," the person, who asked not to be identified, said of Sprint, pointing to the slow economy and tight credit environment. "They've got the right people and the right strategy but it's just going to take time in the trenches."
Sprint, which has been struggling to stem customer losses amid customer service and network problems, has looked at selling its iDen Nextel network, which it bought for $35 billion in 2005, but tough credit markets has made deal financing a challenge.
It announced Whitworth's appointment to its board in February this year, when its shares were trading at around $10 compared to $3 now.
In October last year, the investor had threatened a proxy battle if Sprint did not change its management. Later that month, Sprint's chief executive left, followed soon after by the departure of the company's chief financial officer. Continued... |
