Sprint Corp. (NYSE:S) named a new CEO but that wasn't enough to stop a sell-off of its shares Wednesday in the wake of its abandoned bid for T-Mobile US Inc. (NYSE:TMUS).
Shares in the Overland Park, Kansas, wireless carrier have dropped 18 percent since it decided Tuesday evening to end its attempt to acquire T-Mobile due to increasing regulatory obstacles and opposition. With a T-Mobile deal off the table for now, Sprint named Marcelo Claure, the founder of Miami-based wireless distributor Brightstar Corp., as the company’s next president and CEO.
Claure will take the reins of the U.S. wireless carrier on Monday, taking over from Dan Hesse. Sprint shares opened Wednesday at $5.97 on the New York Stock Exchange, down 18 percent from its Tuesday close of $7.28.
“I’ve had the unique opportunity to spend the past few months actively engaging with Sprint’s board, management team and front-line employees,” Claure said. “In the short-term, we will focus on becoming extremely cost efficient and competing aggressively in the marketplace. While consolidating makes sense in the long-term, for now, we will focus on growing and repositioning Sprint.”
Claure succeeds Hesse, who has led Sprint since 2007 through a number of overhauls and acquisitions, including its merger with Japan’s SoftBank Corp. (TYO:9984), which also owns Brightstar.
While Sprint returned to profit in its first quarter, the carrier has indicated plans to grow and reposition the company, as it continues to face subscriber losses amid growing competition in the wireless market.
Remarks made by Sprint Chairman and SoftBank CEO Masayoshi Son also indicate that Sprint may revisit its pursuit to acquire T-Mobile in the future.
“While we continue to believe industry consolidation will enhance competitiveness and benefit customers, our focus moving forward will be on making Sprint the most successful carrier,” Son said.