Wireless pioneer and billionaire Craig McCaw will be losing some influence at Nextel Communications, the company that he helped propel to success with a $1.1 billion controlling investment back in 1995.
The Reston, Va.-based company said that it expects McCaw to drop somewhat below the five percent ownership threshold shortly, and that would mean that McCaw would no longer have preferred rights to three board seats, nor “rights to appoint board members to serve on the audit, compensation, nominating or corporate governance committees.”
Meanwhile the company named Stephanie Shern, former vice chairman and partner at Ernst & Young, to serve on its board of directors.
Nextel said it revised agreements with both McCaw and McCaw’s Digital Radio company, which control three of the 10 board seats, regarding their original securities purchase agreement.
But McCaw isn’t going away, at least not yet. Nextel’s shareholders will be asked to ratify the appointment of McCaw and Dennis Weibling of Eagle River, to serve their existing terms as members of the board at Nextel’s annual shareholder meeting in May. If ratified McCaw’s term would expire in 2004 and Weibling’s term would expire in 2005. Tim Bryan, also of Eagle River, will serve on the board only until his term expires in May of 2003, however.
Eagle River is McCaw’s investment company.
“Craig has been a significant contributor to our success and has helped us become a major force in the wireless industry,” said Nextel President and CEO Tim Donahue in a statement. “We are pleased Nextel will continue to benefit from his leadership and insight in his role as board member.”
A list of Nextel officers and board members is available here.
McCaw is a Seattle native who made a fortune by cashing in early on the paging and cellular communications market with his McCaw Cellular operation — later sold to AT&T. He was recently ranked by Forbes as the 147th richest person in the world, tied with Amazon.com’s founder and CEO, Jeff Bezos, each with an estimated total net worth of $2.5 billion.
Now, as chairman of Bellevue, Wash.-based Teledesic LLC, in which Bill Gates has invested, McCaw is leading the charge to build “a global, broadband Internet-in-the-Sky” using satellites.
Nextel recently reported a $1.4 billion profit for 2002, the first profit in its 15-year history. Earlier this week Motorola sold 25 million shares of Nextel Communications or about 23 percent of its stake, to an investment bank to realize gains on its investment and increase its cash holdings. The investment bank is reselling the shares on the open market.
