Twenty-five percent of Midwest Wireless employees got the bad news they’d been fearing: layoffs.
The job loss for 150 employees isn’t immediate — most will stay on until September. About 450 employees will remain.
The announcement came Tuesday afternoon from Alltel, which paid nearly $1.1 billion for Mankato-based Midwest Wireless in October.
Most of the job cuts come at the Mankato headquarters. A majority of sales, customer service, facility and network field technicians will remain in their existing regions.
The Mankato office will remain as a call center with about 165 employees providing support for customers, said Scott Bergs, chief operating officer at Midwest Wireless.
The Midwest Wireless name will be replaced with Alltel during the next few months.
The news came the same day that media reports said Alltel is aggressively trying to sell itself to a larger carrier.
Alltel said it will close about 10 Midwest Wireless retail stores this summer. About 30 retail stores will remain open.
The engineering department in Mankato will stay largely intact to support the wireless network.
The Midwest Wireless finance, legal, procurement and most marketing functions will be transferred to Little Rock, Ark., the home base of Alltel.
Bergs would not say whether Alltel will continue to pay for naming rights to the Midwest Wireless Civic Center in Mankato. He said Alltel has signed on as a sponsor for the Minnesota Vikings summer training camp in Mankato.
Alltel is the nation’s fifth-largest wireless company with 11 million customers in 35 states.
Midwest Wireless is a provider for 450,000 customers in southern Minnesota, northern and eastern Iowa, and western Wisconsin.
The Wall Street Journal reported Monday that Alltel is stepping up efforts to sell itself and is drawing interest from AT&T, Verizon and Sprint Nextel.
The Journal said Alltel is an attractive target because it has the largest geographic territory of any carrier. Alltel might also draw interest from private equity investment groups because it has fairly low debt.
A month ago, Midwest Wireless President Dennis Miller announced he was leaving the company. Miller was the driving force behind the company and led it for its entire 17-year history.
Miller said he was not asked to leave and that he wanted to pursue a new technology-based start-up business of some kind.
Midwest Wireless had been owned by a group of 71 investors, including 60 local telephone companies.
Midwest Wireless grew quickly to become one of Mankato’s largest and higher-paying employers. Three years ago it built an addition to its 6-year-old headquarters, bringing it to 130,000 square feet.
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