Metro ditches bid for Leap

MetroPCS Communications Inc. announced it dropped its proposal to merge with Leap Wireless International Inc., following Leap’s disinterest in the deal.
“MetroPCS has not been able to engage Leap in meaningful negotiations regarding MetroPCS’ merger proposal,” Metro said. “As a result, MetroPCS today announced that it is withdrawing its merger proposal.”
Metro’s stock was down around 1% on the news, while Leap’s fell almost 6%.
The announcement doesn’t come as much of a surprise; in Leap’s response to MetroPCS’ offer, Leap CEO Doug Hutcheson said the transaction was “completely inadequate in a number of critical areas.” The fiery rhetoric came as somewhat of a surprise, based on the largely staid corporate pronouncements from most publicly traded companies.
MetroPCS early in September announced an unsolicited $5.1 billion merger bid for Leap.
“MetroPCS believes strongly in its stand-alone prospects and will continue to focus on realizing its significant growth opportunities,” the company said. “In addition to the recent service launch in Los Angeles, MetroPCS expects additional new market launches by the end of 2008 or early 2009 as well as ongoing increased penetration in existing markets to continue to drive growth and create value for MetroPCS’ shareholders.”