RESEARCH TRIANGLE PARK — A longtime Sprint employee, who was laid off along with many others across the company in 2004, received a shocking phone call on Friday from a friend still at the telecommunications outfit.

“Are you coming back,” my friend was asked.

“What are you talking about –” was the flustered response.

More than a few Sprint “ex” employees and current ones apparently were buzzing last week following the hiring of a new chief executive officer to run the telco’s local telephone division. Daniel Hesse, a former AT&T exec, was named to the Sprint post a week ago and announced that he had plans to grow the division, not shrink it.

“If I didn’t think there were growth prospects, I wouldn’t come,” Hesse said it a meeting with the press at Sprint’s corporate headquarters in Overland Park KN. “I think there are great growth prospects in wireline for data.”

Those were very encouraging words for the Sprint LTD folks, especially in its Carolina groups which employs more than 5,000 people. The forthcoming merger of Sprint and Nextel will lead to the spin-off of Sprint’s LTD division as a separate company. And Hesse is making sure people know he has an aggressive agenda with plans to grow high-speed Internet and other services.

“I consider it an honor and a privilege to launch and create this new company,” he said at the press briefing.

The Sprint LTD group employs some 16,000 people servicing 7.6 million access lines in parts of 18 different states. Sprint’s footprint in the Southeast is a large one, covering much of the Carolinas and Florida as well as parts of Virginia and Tennessee. When spun off, it will become the nation’s fifth largest local phone company, according to media reports.

Hesse’s positive words aside, Sprint LTD faces challenges. Its overall revenues dropped in 2004 to just over $6 billion (down $11 million), and so did the number of access lines — by nearly 230,000.. However, the group did report a substantial increase in digital subscriber lines for integrated Internet and voice services to almost 500,000, an increase of one third.

The new boss also did not come cheaply. On Friday, Sprint disclosed that Hesse was lured to the job with a “sign-on” bonus of $600,000 and a first-year salary of $900,000. His contract runs through June 30, 2008. In an SEC filing, Sprint said Hesse is eligible for what it called an “annual target bonus opportunity” of not less than 120 percent of that base pay and not more than 200 percent. He also is eligible for a variety of stock options.

The Associated Press estimated his first-year compensation package to be worth over $7 million.

Sprint and Nextel shareholders will vote on the proposed merger on July 13. If approved, steps will be taking to spin off the Sprint LTD group.

Right now, it appears a good number of people inside and outside of Sprint are looking forward to the change.

Rick Smith is managing editor of Local Tech Wire.