Moody's cuts Sprint Nextel

Moody's Investors Service said it downgraded the corporate family rating for Sprint Nextel Corp. to Ba3 from Ba2, concluding a review that began in November 2010.

The outlook is negative.

The downgrade reflects a view that Sprint's credit profile, despite recent operational improvements, is likely to deteriorate as the company spends heavily to modernize its networks while attempting to formulate its long-run 4G strategy, Moody's said.

The agency said it believes that the ongoing dispute between Sprint and Clearwire Communications Corp. has eroded the competitive advantage of both companies, while industry peers' speed ahead.

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