December 15, 2004 7:00 AM, EST

Sprint, Nextel Agree to Merger

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print Corp. and Nextel Communications Inc. said Wednesday they had agreed to merge. The $35 billion deal would create the nation's third largest wireless telephone service provider.

Nextel offers applications including voice and data communications that are used by trucking fleets.

Under terms of the deal, Nextel stockholders would receive about 1.28 shares in the new company and 50 cents in cash for each Nextel share, the companies said in a statement.

The companies also said they expect to derive savings of about $12 billion from the deal.

Sprint Chairman and Chief Executive Gary Forsee would become chief executive of the new company and Nextel CEO Timothy Donahue would become chairman of the combined entity.

This deal comes seven weeks after Cingular bought AT&T Wireless Services Inc. to form the No. 1 carrier, and leaves about 70% of the $100 billion U.S. mobile-phone market in the hands of three companies, Bloomberg reported.