The telecommunications sector garnered a lot of attention Wednesday as billionaire investor Carl Ichan increased his holdings in Motorola Inc. [MOT] and Clearwire Corp. [CLWR] and Sprint Nextel Corp. [S] disclosed their long-awaited plan to form a $14.5 billion company to build a next-generation wireless broadband network. Investors, however, waited cautiously on the sidelines as home sales declined and oil prices showed no signs of falling. Overall, the Dow dropped 58.13, or .45%, to 12,961.96, and the Nasdaq declined 8.63, or .35%, to 2,474.38 in Wednesday midday trading.
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Activist investor Icahn increased his holdings in Motorola to 7.6% from 6.4%, as a recent SEC filing says the billionaire and his affiliates purchased 172.2 million Motorola shares for an aggregate price of $2.36 billion. Icahn has been pushing for change at Motorola as the company's stock has been floundering. Icahn's been somewhat successful: Motorola agreed to support two of four board nominees he backed. Shares of Motorola are trading down 24 cents, or 2.34%, to $10.02.
Meanwhile, shares of Sprint increased modestly 5 cents, or .54%, to $9.24, as the telecom company reached a much anticipated accord with Clearwire to create a $14.5 billion company to build a next-generation wireless broadband network. The new company would develop a WiMax network offering coast-to-coast wireless Internet at speeds up to five times faster than traditional wireless.
Lastly, in the middle-market sector, military and engineering company KBR Inc. advanced $1.78, or 5.67%, to $33.15 on its acquisition of privately held construction company BE&K Inc. "Growing our services business unit remains a key strategic objective for KBR," William P. Utt, KBR chairman and chief executive, said in a statement. "Acquiring BE&K is a significant step in re-establishing KBR as a leading North American contractor and maintenance services provider." - Gerald Magpily
