Sprint chief makes a break for it

Last week’s rumours about Sprint Nextel’s Gary Forsee rang true on Monday night, as the chief executive and chairman stepped down from his post.

Forsee’s departure is effective immediately and comes in the wake of shareholder discord as Sprint failed to keep up with rivals Verizon Wireless and AT&T in terms of subscriber growth, following the 2005 merger of Sprint and Nextel.

As the Sprint Nextel board begins the search for a new CEO, board member James Hance will assume the role of acting non-executive chairman and CFO Paul Saleh will serve as acting CEO.

Although it is known that rebel shareholder Ralph Whitworth has been building his stock pile and is seeking a seat on Sprint’s board, a statement from the board suggests that Forsee may have jumped before he was pushed.

“The decision to seek a new CEO was based on the board’s belief that it is the right time to put in place new leadership to move the company forward in improving its performance and realizing corporate objectives,” the statement read.

But there is growing concern that a new leadership could have negative effects on Sprint’s multi billion dollar WiMAX network, being built in conjunction with Clearwire.

Sprint has become something of champion of for the wireless broadband technology but Whitworth for one is publicly opposed to Sprint’s fascination with WiMAX and has said it detracts from the operator’s core business.

Further evidence of Sprint’s disappointing performance was also revealed as the company announced that it expects to report a net loss of approximately 337,000 postpaid subscribers in the third quarter. In addition, both adjusted OIBDA and consolidated operating revenue for 2007 are expected to be slightly below the range of previous guidance of $11bn to $11.5bn in adjusted OIBDA and $41bn to $42bn in consolidated operating revenue.

Sprint Nextel will release its third quarter results on November 1.