In a press release this morning, Sprint has announced that it will purchase publicly traded MVNO Virgin Mobile USA for $483 million factoring in the value of Sprint’s 13.1% ownership stake along with completely retiring Virgin Mobile’s current debt load of $248 million with a further reduction to $205 million on September 30th.
Sprint will bring the Virgin Mobile executive team directly under corporate control with current CEO Dan Schulman reporting directly to CEO Dan Hesse and Boost CEO Matt Carter reporting to Schulman, signaling a shift in corporate hierarchy.
Both Boost Mobile and Virgin Mobile will continue to operate as normal, with customers experiencing minimal consumer side changes. Most of the changes will come from the retail/wholesale side as the purchase enables Sprint to offer Sprint products directly to Virgin Mobile distributors and dealers.
For its part, Virgin Mobile launched as one of the first MVNOs in the country on Sprint in 2002 before going public and becoming an independent company in 2007. Virgin Mobile subsequently purchased the failed Helio MVNO from SKTelecom for $39 million in 2008 which included all assets and branding along with launching the latest Helio handset in the Ocean 2 in February and its first 3G 1xEVDO handset in the Shuttle later in the year.