Sprint Nextel says it may write off up to $31 billion related to the merger that created the combined company. The move comes just after a regime change at the company, which has struggled since the 2005 merger, and lost about 1 million customers last year. The write-off, accounting for most or all of the “goodwill” from the merger, will probably mean a big Q4 loss, reports the Washington Post.
“Taking the charge just reinforces” the perception that “the Nextel acquisition has been a disaster," said an analyst. Investors were unworried, however, and Sprint shares closed up 17 cents after the disclosure yesterday. Sprint said the write-off wouldn’t affect its cash balance or future cash flow, and that it would give the exact amount when it releases financial results Feb. 28.