Sprint: Top job offered to BellSouth's Forsee

OVERLAND PARK, KANSAS - Sprint Corp. broke its silence Sunday evening on reports of a top management change, saying it has offered the CEO job now held by William T. Esrey to Gary D. Forsee, vice chairman of BellSouth Corp.<br> <br> By the time Sprint issued its brief statement, a BellSouth spokesman in Atlanta had already announced that a judge there had granted its request for a temporary restraining order to keep Forsee from taking the job.<br> <br> Forsee, a former Sprint executive, has a noncompete clause in his contract, and Jeff Battcher, the BellSouth spokesman, said attorneys for the two companies &#34;are in discussion about this matter.&#34; A hearing is expected in a few days.<br> <br> The Wall Street Journal first reported on Wednesday that Esrey, both chairman and CEO of Sprint, was about to leave and that Forsee would succeed him. Sprint had been declining to comment about what it described as &#34;media speculation regarding management succession.&#34;<br> <br> The statement it issued Sunday night said that independent directors &#34;have been evaluating management succession alternatives,&#34; and that the job as CEO had been offered to Forsee, 52.<br> <br> The announcement said Esrey, 63, &#34;is expected to stay as chairman for a transition period.&#34; It also said that Esrey and Ronald LeMay, the telecommunication company&#39;s president and chief operating officer, &#34;remain in their current positions.&#34;<br> <br> LeMay, 57, who is also expected to leave, had long been regarded as the likely successor to Esrey, Sprint&#39;s CEO since 1985 and its chairman since 1990. Esrey&#39;s departure has been expected since the announcement in November that he was undergoing treatment for lymphoma, but there was no mention of his health in Sunday&#39;s statement.<br> <br> Irvine O. Hockaday Jr., an outside member of the Sprint board, declined to comment further on the developments.<br> <br> &#34;I&#39;m just going to tell you the statement speaks for itself,&#34; he said. &#34;As events progress and it becomes either required or appropriate, even if not required, to offer additional information, that will be done.&#34;<br> <br> Esrey and LeMay both serve on Sprint&#39;s eight-member board.<br> <br> Sprint, the nation&#39;s third largest long-distance provider and fourth-largest wireless provider, has laid off more than 15,000 employees since October 2001. Its stock prices are down sharply.<br> <br> During the third quarter that ended Sept. 30, Sprint reported earnings of $519 million, compared to a loss of $134 million in the same quarter a year earlier. The company is scheduled to report fourth quarter results on Wednesday.<br> <br> In December, Sprint said it expects earnings per share of 37 cents to 39 cents for its long-distance division. For all of 2002, earnings per share are expected to be $1 to $1.35 on revenues of $15.2 billion, compared with revenues of $16.92 billion in 2001.<br> <br> In the 1990s, Forsee led Sprint&#39;s long-distance division and is credited with its fast growth. In 1998, he was named chief executive of Global One, a failed international joint venture between Sprint, France Telecom and Deutsche Telekom. He left that job in 1999 and joined BellSouth.<br> <br> The BellSouth lawsuit is based on a clause in Forsee&#39;s employment agreement that prevents him from joining a competing company for 18 months after leaving BellSouth.<br> <br> Noncompete clauses are common in employment contracts, and Forsee had a similar court fight when he left AT&T for Sprint. AT&T threatened to sue him for breaching a confidentiality agreement, but Forsee went to court first and a judge refused to stop him from taking the Sprint job.<br> <br> LeMay joined Sprint in 1985 as vice president and general counsel for the United Telephone System. He was appointed president and chief operating officer in February 1996. He left briefly to become head of Waste Management, but was soon welcomed back.<br> <br> A clause in LeMay&#39;s employment contract gives him the right to leave with a year&#39;s pay and the ability to exercise all his stock options if he is not named CEO upon Esrey&#39;s departure.<br> <br> Sprint&#39;s FON tracking stock, which was trading at more than $74 a share in November 1999, closed Friday at $12.14. Sprint&#39;s PCS tracking stock, which was over $64 in March 2000, closed Friday at $3.76.<br>

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