Sprint gets slapped with debt downgrade, lawsuit
If there's one thing Sprint doesn't need at the moment, we'd say that "a harder time getting cash" ranks high on the list. That's where big ol' number three finds itself at the moment, though, thanks to a credit downgrade by Standard & Poor's from "BBB-" to "BB," a move that puts its bonds squarely in junk territory. S&P has some harsh words for Sprint regarding the move, too, explaining that it went down thanks to its "assessment that Sprint Nextel's business risk profile is no longer supportive of an investment-grade rating given its deteriorating operating performance and lack of visibility in the wireless business." Lack of visibility in the wireless business, eh? Snap! The junkification of Sprint's debt coincides with the installment of a new CFO -- purely a coincidence, no doubt -- effective immediately.
But wait, the bad news isn't over. A workers' lawsuit filed in US District Court last week alleges that Sprint dumped pension plan cash into Sprint stock at a time when... well, let's just say that it wasn't exactly a solid investment. The suit names 12 Sprint board members as co-defendants and looks to recover the money lost as Sprint stock slid into the basement; furthermore, it's looking to garner class-action status, meaning that the carrier could potentially owe money to a whole boatload of employees if the plaintiffs win the whole shebang.
Read - Debt downgrade, new CFO
Read - Pension plan lawsuit
