Sprint Nextel: A House Divided

Two years into merger, partners remain wary of each other
By Jim O'Neill,  Newser User
Posted Nov 25, 2007 1:27 PM CST
Gary Foresee, then-CEO of Sprint, left, and Tim Donahue, CEO of Nextel, chat with Nextel employees in the lunchroom of the Nextel complex in Reston, Virginia, on Thursday, June 23, 2005.   (KRT Photos)
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(Newser) – The $35 billion merger of long-distance carrier Sprint and wireless innovator Nextel sought to create a company capable of competing with the nation’s largest wireless carriers, Verizon and AT&T. Instead, distinct cultures have warred over everything from ad strategies to executive teams, leaving the company with poor morale, stalled projects, and a sagging stock price, the Washington Post reports.

The 2005 deal kept two headquarters and unsuccessfully addressed how Sprint’s button-down approach to business and Nextel’s entrepreneurial culture might clash. There remains mistrust between the factions, especially after Sprint CEO Gary Forsee, who orchestrated the deal, last month was forced to step down. “No one could have predicted how difficult the true integration would be," said a Sprint exec.