Sprint Nextel said yesterday that it will buy two small cellphone operators who sell Sprint service, resolving a legal dispute over Sprint's...

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KANSAS CITY, Mo. — Sprint Nextel said yesterday that it will buy two small cellphone operators who sell Sprint service, resolving a legal dispute over Sprint’s purchase of Nextel while adding 332,000 subscribers to the newly merged company’s customer base.

Sprint Nextel agreed to pay $219 million and assume $208 million in debt to acquire IWO Holdings of Albany, N.Y., which provides Sprint services to 237,000 subscribers in upstate New York, New Hampshire, Vermont and parts of Massachusetts and Pennsylvania.

Sprint Nextel also agreed to pay $212.5 million and assume $75 million worth of debt to acquire privately held Gulf Coast Wireless of Baton Rouge, La., which provides Sprint services to 95,000 subscribers in southern Louisiana and Mississippi.

As part of its agreement, Gulf Coast Wireless will seek an immediate stay to litigation it had filed challenging the Sprint-Nextel merger, which was completed Aug. 12.

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A number of Sprint’s 11 affiliates also filed suit, claiming the acquisition of Nextel would allow Sprint to violate agreements not to compete with the affiliates in their territories.

Earlier this month, federal regulators approved Sprint’s purchase of Lake Charles, La.-based affiliate U.S. Unwired for $1.3 billion, ending that company’s legal challenges. Sprint Nextel has brokered deals with several other Sprint affiliates, promising to stay out of their territories while the sides negotiate a long-term deal.

Sprint Nextel’s biggest remaining hurdle is with Kirkland-based Nextel Partners, which sells Nextel services in 31 states and is trying to exercise a contractual right to be acquired by the larger company in the case of a major merger such as the Sprint deal.

The board of Nextel Partners is asking shareholders to vote to exercise a “put” option to require Sprint Nextel to buy the two-thirds of the affiliate it doesn’t own. However, the two sides have disagreed over how to value that two-thirds stake.

Nextel Partners wouldn’t comment on Sprint Nextel’s latest deal with affiliates.

Sprint Nextel will pay $42.50 a share in cash for IWO, 19 percent more than the last over-the-counter trade last Wednesday.

“It suggests Sprint Nextel is willing to pay a premium at least with the smaller affiliates and indicates they want to avoid the legal expense,” said Christopher King, a Legg Mason Wood Walker analyst.

The company may spend as much as $14 billion buying affiliates, Moody’s Investors Service analyst Marcus Jones said this month.

The purchases of IWO and Gulf Coast require regulatory approvals, and Sprint Nextel said they probably will close in the fourth quarter.

Information from Bloomberg News is included in this report.