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Motorola expects $780 million Nextel windfall

The mobile handset maker said it expects an after-tax gain of $780 million as a result of the megamerger of cellular providers Sprint and Nextel.

Motorola, the second-largest mobile handset maker in the world, said it expects an after-tax gain of $780 million as a result of the just-completed megamerger of U.S. cellular providers Sprint and Nextel. The company has been promised about 69 million shares of the new Sprint Nextel and about $46 million in cash in exchange for its five-percent holding in Nextel, according to a Securities and Exchange Commission made by Motorola on Friday. There's one caveat: Motorola has to hold onto at least 37.6 million Sprint Nextel shares until Dec. 31, 2006.

The estimated $35 billion merger between Nextel and Sprint became official on Friday, creating the third-largest U.S. cell phone operator.