Gary Forsee, the chief executive who headed Sprint’s merger with Nextel in 2005 may be in trouble with the Sprint Nextel Board of Directors. It is rumored that the board hopes to replace Mr. Forsee by December of this year. Poor stock performance, less than expected profits and low subscription rates are given as reasons for making an executive change.
The board may be looking out-of-house for a new Captain. Candidates for the job need to have a strong sales and marketing background in the hope of improving the company’s new subscription numbers. One could infer from this that the board is unhappy with Sprint Nextel’s sales staff from the top down. The year 2008 may see a major change in the way the company does business.
Sprint’s stock price in down nearly 18% from its 52-week high. It closed yesterday at $19.28. Shareholders are unhappy with the companies stock performance, among them Ralph Whitworth, a founder of Relations Investors. The investment firm owns nearly 2% of Sprint stock and is unhappy with the way Mr. Forsee has managed the company.
Others see Sprint’s troubles coming from the time of the merger, not poor management. At the time of the merger the two companies operated on different wireless technologies which made combined operations difficult. Sprint Nextel also lacks popular handsets and accepts too many subscribers with poor credit.
There is a good chance that 2008 will see some major changes at Sprint Nextel. How far the Board of Directors is willing to go to shake things up is a closely guarded secret, but if Sprint Nextel hopes to gain market share and boost stock price change is coming.