Sprint to Buy iPCS for $426 Million, Ends Litigation and Pending iDEN Divestiture

Sprint has announced that it will be purchasing the largest remaining affiliate in iPCS for $426 million in cash, effectively ending years worth of litigation and a planned divestiture of iDEN assests as the result of a legal decision earlier this year.

iPCS provided cellular service under the Sprint brand name as a result of a longstanding affiliate agreement which began at the inception of Sprint PCS as a company and service provider in 1996, with the affiliate providing service under the Sprint brand in the 81 markets throughout Illinois, Michigan, Pennsylvania, Indiana, Iowa, Ohio and Tennessee.

In recent years, iPCS was better known for continually filing suit against Sprint over recent deals involving Clearwire, Virgin Mobile USA and offering Nextel-branded services in iPCS territory, claiming its affiliate agreement was continually infringed on the basis of direct competition.

Because of the above, many savvy customers that lived in iPCS territory continually expressed frustration at the company for fighting Sprint at every turn for everything from plan consistency to service quality, which was considered subpar compared to markets directly controlled by Sprint.

With the purchase, Sprint has now added 700,000 direct customers, 270,000 additional customers using MVNO services that use the Sprint network and an expansion of service territory that now spans an additional 12.6 million people.

The purchase is expected to be completed by the end of the year pending necessary regulatory approvals.

Correction: We apologize for an error in the initial version of the article. We incorrectly stated that iPCS was the “lone remaining” and not the “largest remaining” affiliate. While it was a typographical error, the remainder of the report is correct.