Mccaw Gets Lots Of Stock In Divorce

Wendy P. McCaw, the former wife of cellular telephone pioneer Craig O. McCaw, received major stakes worth at least $460 million in Nextel Communications Inc. and Nextlink Communications Inc. as part of their divorce settlement, a regulatory filing shows.

The couple, who married in 1974 and have no children, “reached an amicable settlement in their marital dissolution” Oct. 10, according to a statement they issued. It added that the two “continue to share a deep respect for each other,” and that terms of the settlement would remain confidential.

The announcement brought to a peaceful conclusion an epic battle that involved teams of lawyers and bankers from both sides who were trying to arrive at a value on their joint assets that Forbes magazine estimated at $2 billion.

At one point, Microsoft Corp. Chairman Bill Gates, an investor with Craig McCaw in satellite company Teledesic Corp., was ordered to give a deposition to Wendy McCaw’s lawyers after Craig McCaw filed for a divorce, according to Seattle newspaper accounts.

The McCaws and their representatives did not respond to requests for comments. If the intent was to keep the terms quiet, however, the McCaws failed to reckon with the requirements of U.S. securities laws, which specify that changes in ownership stakes of all persons owning more than 5 percent of a company’s stock must be disclosed.

A Los Angeles law firm representing Wendy McCaw broke the ice on Oct. 20 when it filed 13-D documents with the Securities and Exchange Commission that detailed at least some of the stock transfers resulting from he divorce. Craig McCaw filed his own 13-D a day later with much of the same details included.

The SEC filings may not be a complete listing of their property division, though; stakes in Teledesic and other private companies, along with their property holdings in Washington, California and elsewhere aren’t included. The divorce case was filed in state court in Washington, a community property state where spouses are entitled to equal shares of assets acquired during the marriage.

In her filing, Wendy McCaw said she might sell some of her a 5.83 percent stake in McLean, Va.-based Nextel, a provider of digital wireless communications services. She received 9.3 million Class A common shares - worth about $240 million at today’s prices - plus options for 4.9 million additional shares with an undisclosed exercise price, according to the filing. She also assumed $101.8 million in debt for the acquisition of some of the Nextel shares, according to the filing.

Craig McCaw, 48, purchased a controlling stake in Nextel after he sold his startup cellular service business, McCaw Cellular, to AT&T Corp. for $11.5 billion in 1994. His investment group retains a 27.4 percent Nextel stake after the property split, according to his Oct. 21 SEC filing.

Craig McCaw and his investment group now hold 78.3 million shares in the wireless service provider, some as options and convertible preferred stock, the group’s filing said.

A spokesman for Nextel, which has a market capitalization of $6.3 billion, declined to comment on the divorce. In an Oct. 23 Form 8-K filed with the SEC, the company said, “Nextel does not currently anticipate that the implementation of the settlement agreement will have a material impact on the equity interest of Mr. McCaw and his affiliates in Nextel, or result in any material change to the corporate governance of Nextel.”

However, the agreement could affect board member selection and other governance issues at Nextlink Communications Inc., the Bellevue-based local phone and data communications service provider Craig McCaw still controls.

Wendy McCaw received a 26.8 percent voting stake and the ability to name a member to the board of the telecommunications provider. Under the divorce settlement, he agreed to vote for her board nominee as long she still holds half her current 9.7 million Class B shares and the two still have enough combined voting power to elect three directors.

Meanwhile, Craig McCaw received the right to vote enough of Wendy McCaw’s shares as needed to maintain voting control of the Bellevue, Washington-based company, as long as he owns half his current shares. He now holds a 52.1 percent voting interest. Voting percentages were calculated by a spokesman for Nextlink, which has a market capitalization of about $834 million.

Wendy McCaw’s Nextlink stake worth is about $220 million.