Leap Wireless International Inc intends to sell 6.1 million shares of its common stock in order to raise cash
A company very similar to Leap Wirless, MetroPCS, added 450,000 customers in the first quarter of 2007 easing analysts concerns that an economic downturn would hurt customer additions. These two companies serve mainly low-income groups, whose spending is impacted by economic conditions.
MetroPCS offered to purchase Leap at a $75 per share price tag. Leap declined the offer, and MetroPCS subsequently withdrew it. The two wireless communication companies compete with much larger telecom giants, and a merger could help them compete.
MetroPCS Communications Inc. proposed to buy Leap Wireless International Inc. for $5.3 billion in stock. The deal will result in the formation of the fifth-largest wireless carrier in the U.S.