Two wireless cable companies have come one step closer to
finalizing their merger agreements with major long-distance carriers.
Last week, Albany, N.Y.-based CAI Wireless Systems Inc.
received approval from the Federal Communications Commission for its proposed $172 million
merger with Jackson, Miss.-based LDC MCI WorldCom.
And shareholders of Shelton, Conn.-based People's Choice TV
Corp. (PCTV) approved its planned $151 million merger with Sprint Corp.
CAI stated in a press release that MCI is expected to
acquire additional shares of the company, resulting in it owning more than 50 percent of
CAI shares. MCI currently holds about 48 percent of CAI stock.
The FCC approval is not expected to affect any planned
action by a group of disgruntled CAI institutional investors led by Resurgence Asset
Management LLC of White Plains, N.Y.
In late June, Resurgence expressed some concerns regarding
the price that MCI would pay for CAI shares, citing similar deals with much higher prices.
However, if Resurgence plans any action to block the deal,
it most likely would do so before or during a shareholder vote to approve the deal. So
far, no date has been set for a shareholder vote.
"We're considering all of our options,"
Resurgence chief investment officer James Rubin said. "Our opinion remains the same.
MCI announced in March its intention to purchase roughly
6.1 million CAI shares for $28 each. The No. 2 LDC plans to use CAI's wireless spectrum to
provide the "last-mile" connection to customers' homes for local telephone and
high-speed Internet services.
CAI expects to merge into a wholly owned subsidiary of MCI
during the third quarter of this year.
The PCTV merger still needs approval from the FCC. Sprint
agreed to purchase PCTV's outstanding shares for $10 each in April.
Sprint plans to use PCTV's spectrum as a last-mile
connection for its Integrated On-Demand Network (ION), a high-speed Internet and
communications service that it expects to launch in 35 cities across the country before
the end of the year.