Sprint Nextel (NYSE:S) is being pressured to field shareholder questions about the future strategic and operational direction of the telecom provider following Ralph Whitman's growing impatience with CEO Gary Forsee. Many analysts are now looking at a wide range of strategic options that the company could consider to unlock value and narrow its focus.

Sprint Nextel continues to work on integrating issues from its $35 billion 2005 merger while focusing on building a new generation broadband network that has proven to be a significant cash drain to date. The so-called WiMax project is not expected to contribute to the company's profitability for several years and has many investors questioning management's moves.

Sprint does have some strategic options that it could consider, according to those familiar with the situation. The company could put its long-distance division up for sale, which serves large corporate and government clients. However, the company would then have to factor in the fact that they use some of the fiber networks to carry wireless traffic. This sale could generate $4.8 billion in after-tax proceeds.

Other suggest that the company should abandon its new venture and sell the 2.5 Ghz spectrum license that Sprint has reserved for WiMax. Such a deal could net the company $3.4 billion after-tax while eliminating further cash burn. However, the company argued that this project is critical to the success of the company in the future and will begin to gain momentum in 2009.

In the end, Sprint investors may have to remain patient for now as the company works to improve its WiMax project and streamline other businesses. Whether or not the company will shop any of its divisions remains to be seen; however, it is definitely a situation worth watching!

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A large HealthSpring Inc. (NYSE:HS) shareholder expressed its belief that the healthcare company should undergo a share repurchase to unlock value, according to a Schedule 13D/A filing with the SEC. Shareholders are hoping that the hedge fund can force management to take action and help the company's fledging stock price.

The Clinton Group, which owns 4.9 percent of the company, indicated their belief that HealthSpring should take on additional debt or investigate a range of other options to ramp up their share repurchase program. Moreover, despite the hedge funds reduction in its position in the company, it still continues to support the management team.

"Despite (i) the strong Q2 financial  performance and the surpassing of analyst expectations, (ii) the increase in 2007 EPS guidance, (iii)  positive legislative developments and (iv) the completion of the accretive acquisition of Leon Medical Centers Health Plans, Inc., HealthSpring stock continues to languish at a valuation below its peers," said the hedge fund in a letter to the board.

The hedge fund then reiterated its belief that the company has additional debt capacity to repurchase shares to unlock this value, and that management should either (i) investigate upsizing its pending debt raise or adding another tranche to execute a Dutch Auction repurchase of the Issuer's shares or (ii) employ its unrestricted parent cash and $100 mm undrawn revolver to aggressively execute open market purchases of the stock.

In the end, any actions taken by HealthSpring could go a long way to unlock value in a company that is clearly undervalued. Combined, these factors make HS a stock that is definitely worth watching!

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Vonage (NYSE:VG) shares jumped $0.47, or 40.88%, to $1.62 after the company announced that it settled its patent dispute with Sprint Nextel (NYSE:S) in a press release. The deal will include a $35 million payment for past use, $40 million for future use, and a $5 million prepayment for services.

"We are pleased to resolve our dispute with Sprint and enter into a productive future relationship," said Sharon O'Leary, General Counsel for Vonage. "We believe this deal is good news for Vonage, our customers and our shareholders. It allows us to put this litigation behind us and continue to focus on our core business by removing the uncertainty of legal reviews and long term court action."

Vonage shares have been suffering ever since a Kansas jury handed down a verdict on September 25th finding that the company had infringed on six Sprint patents. Many shareholders and analysts were concerned that the company would not be able to fight the legal battle and be forced into bankruptcy. Shares are now trading close to the levels they were before the verdict was announced.

Vonage still faces an uphill legal battle with Verizon Communications (NYSE:VZ), however, which was awarded $58 million in damages in March plus 5.5 percent royalties on future revenues after finding that the company violated three Verizon patents. Vonage executives vowed to fight this ruling but the company may be forced into another large settlement.

In the end, this is good news for shareholders but Vonage still faces an uphill battle. Not only do more legal battles remain on the horizon, but the company must also face the problem it had before all of this started - convincing people to switch to VOIP phone services. Despite all of tihs, VG is definitely a company worth watching!

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