Sprint buys fifth PCS affiliate

Sprint is continuing its coerced buying spree in the wake of its merger with Nextel. It announced today it is buying its fifth PCS affiliate, UbiquiTel, to stave off a lawsuit accusing Sprint of violating its affiliate agreement.

Sprint is paying $1.3 billion for UbiquiTel, which serves mid-sized markets in California, Idaho, Indiana, Kentucky, Nevada, Tennessee, Utah, Washington and Wyoming. Its footprint covers 8.3 million people, and the deal will add an additional 600,000 subscribers to the Sprint Nextel network, but it is also assuming the operator’s $300 million in debt.

Though not the largest affiliate Sprint has bought, UbiquiTel brings the total cost of post-merger acquisitions for Sprint to more than $14.5 billion and it has taken on billions more in debt, right after shelling out $36 billion to buy Nextel. In July, before the Nextel deal closed, Sprint agreed to buy U.S. Unwired for $1.3 billion and in August it purchased IWO Holdings and Gulf Coast Wireless for a combined $714 million. The big ticket items, however, were Alamosa Holdings, Sprint’s largest affiliate going for $4.3 million, and Nextel Partners, Nextel’s own affiliate group, which sold for a whopping $6 billion.

There are still possible acquisitions in the offing. Of Sprint’s original 18 affiliates, at least seven have sued the company, and of those seven Sprint has bought five. The litigants are all claiming that Nextel’s footprint overlaps their own, violating the exclusive service agreements Sprint has with those affiliates. The UbiquiTel deal, as with the other purchase deal, would immediately stay its lawsuit against Sprint if it goes through. Sprint expects to close the deal this quarter.