Hedge fund Greywolf Capital opposes the company's planned acquisition by Sprint Nextel (ticker: S) and won't tender its shares. IPCS, which has the exclusive right to market and sell Sprint Nextel service in 80 Midwestern markets, said on Oct. 19 that it had agreed to be bought by Sprint Nextel for $24 a share in cash and the assumption of $405 million in debt. (For more details, see the Activist Spotlight column, at right.)

Outperform - Price 23.81 on Oct. 20
by Raymond James Global Research

Sprint (S) and iPCS have announced an agreement for Sprint to acquire iPCS for $24 a share in cash, plus the assumption of $405 million in net debt for a total EV of approximately $831 million. The transaction value [was reported to be] 6.4 times projected 2010 adjusted Ebitda [earnings before interest, taxes, depreciation and amortization]....Sprint expects to achieve approximately $30 million in annual synergies and for the transaction to be accretive to FCF in 2010. The transaction is anticipated to close in late 4Q09 or early 2010. Regulatory approvals should proceed [apace, as iPCS operates] as a Sprint affiliate....This transaction will leave just one publicly traded Sprint affiliate, Shenandoah (SHEN), and one company, NTelos (NTLS), that with its exclusive roaming agreement acts like a Sprint affiliate in parts of Virginia and West Virginia. Both Sprint and iPCS will seek an immediate stay of all pending litigation between the two parties, with a final resolution to become effective upon the closing of the acquisition. This will remove a road block from the closing of Sprint's acquisition of Virgin Mobile, and will also remove a potential obstacle from Clearwire 's (CLWR) 4G [fourth-generation] build-out. Sprint will no longer be required to divest its IDEN network that overlaps iPCS territories. Market cap: $410 million.

Downgraded by Jefferies & Co from Buy to Hold