Virgin Mobile USA, a joint venture of Sprint Nextel and the Virgin Group, expects to raise about $375.6 million after expenses in its initial public offering (IPO), according to a Securities and Exchange Commission filing.
In the filing, Virgin Mobile said it expects shares to price between $15 and $17 each. The IPO includes a total of 27.5 million shares; the prepaid carrier is offering 25.6 million shares of Class A common stock, while a group of shareholders, including Best Buy and Sprint Ventures, are selling an additional 1.9 million shares. Sprint Nextel and the Virgin Group plan to hold two other classes of stock, controlling the company after the offering.
Virgin also said that the net proceeds will be used to repay some debt and to pay Sprint Nextel for limited liability company interests. The rest of the proceeds will go to general corporate purposes.
The company plans to list its shares on the New York Stock Exchange under the symbol VM.
With the current economic climate, wireless operators face shrinking marketing budgets and reduced consumer spending.
Globally, the credit crunch is very much alive, and operators will be tightening their belts into the foreseeable future by putting off capital purchases.
