Sprint Nextel (NYSE:S) today announced an agreement to sell
approximately 3,300 towers to TowerCo for approximately $670 million in
cash. Additionally, the two companies have entered into a long term
leasing agreement where TowerCo will provide Sprint Nextel with wireless
communications towers to support the company’s
CDMA, iDEN and WiMAX networks.
“By leasing rather than owning these network
facilities, we can better focus on our core business of providing
communications services to consumers, businesses and government
customers,” said Bob Azzi, senior vice
president, Field Engineering and Operations, Sprint Nextel. “Significantly,
this transaction provides Sprint Nextel with additional liquidity which
gives us greater flexibility in managing our company.”
“These are great towers concentrated in large
metropolitan markets throughout the U.S. and will benefit as wireless
communications continue to grow,” said Richard
Byrne, TowerCo's CEO.
The specific number of towers and final purchase price will be
determined at closing. The transaction, subject to customary closing
conditions, is expected to close in 90 days.
Equity financing for this transaction will be provided by Tailwind
Capital, Soros Strategic Partners II LP, Stone Tower Equity Partners and
Vulcan Capital.
In this transaction, Sprint Nextel was advised by Wachovia Capital
Markets, LLC, Citi and the law firm of Jones Day. TowerCo was advised by
UBS Investment Bank and the law firm of Paul, Weiss, Rifkind, Wharton
and Garrison LLP.
About Sprint Nextel
Sprint Nextel offers a comprehensive range of wireless and wireline
communications services bringing the freedom of mobility to consumers,
businesses and government users. Sprint Nextel is widely recognized for
developing, engineering and deploying innovative technologies, including
two wireless networks serving nearly 53 million customers at the end of
the first quarter 2008; industry-leading mobile data services; instant
national and international push-to-talk capabilities; and a global Tier
1 Internet backbone. For more information, visit www.sprint.com.
About TowerCo
TowerCo was founded in 2004 by Tailwind Capital and industry veterans
Richard Byrne, Chief Executive Officer, and Scot Lloyd, Chief Operating
Officer, to meet the infrastructure needs of wireless service providers
by developing, owning and leasing communication towers. Soros Strategic
Partners invested in TowerCo in December 2005. Currently TowerCo has
exclusive contracts to build towers directly for carriers throughout the
U.S. TowerCo is based in Cary, N.C. For additional information please
visit www.towerco.com.
Safe Harbor Statement
This news release includes "forward-looking statements" within the
meaning of the securities laws. The statements in this news release
regarding the business outlook and performance, new products and
services, future network capabilities and performance, expected
investments, as well as other statements that are not historical facts,
are forward-looking statements. The words "estimate," "project,"
"forecast," "intend," "expect," "believe," "target," "providing
guidance" and similar expressions are intended to identify
forward-looking statements. Forward-looking statements are estimates and
projections reflecting management's judgment based on currently
available information and involve a number of risks and uncertainties
that could cause actual results to differ materially from those
suggested by the forward-looking statements. With respect to these
forward-looking statements, management has made assumptions regarding,
among other things, customer and network usage, customer growth and
retention, pricing, development, deployment and operating costs,
availability of devices, the timing of various events and the economic
environment.
Sprint Nextel believes these forward-looking statements are reasonable;
however, you should not place undue reliance on forward-looking
statements, which are based on current expectations and speak only as of
the date of this release. Sprint is not obligated to publicly release
any revisions to forward-looking statements to reflect events after the
date of this release. Sprint Nextel provides a detailed discussion of
risk factors in periodic SEC filings, including its annual report on
Form 10-K for the year ended December 31, 2007.
