Leap Wireless Forms Texan Joint Venture

USA based Leap Wireless is effectively merging its Southern Texas network with that of local rival, Pocket Communications to form a new joint-venture covering the area. At the closing, the joint venture will acquire substantially all of Pocket Communications' and Cricket's wireless licenses and operating assets for the South Texas region.

Leap will own approximately 76 percent of the joint venture and Pocket Communications will own approximately 24 percent. As one step in the transaction, immediately prior to the closing, Leap will purchase some of Pocket Communications' South Texas assets for approximately $38 million in cash, which Leap will then contribute to the joint venture together with its own South Texas assets.

Leap had approximately 5 million customers across the nation at the end of 2009, including approximately 400,000 in the South Texas region. Pocket Communications had approximately 320,000 customers in the South Texas region at the end of 2009.

"We are pleased to have come to a mutually beneficial agreement with Cricket; the benefits of this transaction are obvious and clearly create a combined value that is significantly more than the individual parts," said Paul Posner, Pocket's chief executive officer. "As a combined entity, South Texas should continue to be one of Cricket's best performing regional clusters and we at Pocket are excited to be bringing even more robust offerings to our retail channel partners. These enhanced offerings will allow the combined operations to compete even more effectively against other flat-rate wireless operators in the area,"

Following the closing, Pocket Communications will continue to provide services under the Pocket brand in New England.