Sprint selling its headquarters campus
Sprint (S) is selling its Overland Park headquarters in a reorganization drive ahead of its planned merger with T-Mobile (TMUS). The company has reached an agreement to sell the headquarters to Occidental Management, according to the Kansas Business Journal.
Sprint is expected to continue operating from the Overland Park campus, as it has agreed to lease back several office blocks from Occidental Management. Still, the decision to divest the headquarters campus seems to provide an early indication of how Sprint is planning for a fluctuating workforce if it completes its merger with T-Mobile.
5G network rollout
The divestiture of the Overland Park campus also comes as Sprint works on its 5G network deployment, raising the possibility that the company may be monetizing some of its assets to raise funds to finance its 5G projects. Sprint exited the December quarter with $6.3 billion in cash. For its fiscal 2018, which ended in March, Sprint expects to spend between $5.0 billion and $5.5 billion on capital expenditure. Sprint’s capex is likely to be higher in fiscal 2019 as the company prepares to start providing 5G services in at least nine cities by June.
Sprint’s capex is likely to rise in fiscal 2019 as the company is underway with its 5G network buildout in several cities across the country with the planned launch of 5G services in at least nine cities in the first half of 2019. If the 5G deals we’ve seen are any indication, 5G network buildout isn’t cheap. For example, T-Mobile last year signed Nokia (NOK) and Ericsson (ERIC) for 5G contracts worth $7.0 billion combined. A year ago, Sprint revealed that it was working with telecom gear vendors Nokia (NOK), Ericsson (ERIC), and Samsung (SSNLF) on its 5G rollout project.