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Friday November 26, 3:16 pm Eastern Time
AT&T Wireless affiliate Tritel sets IPO terms
WASHINGTON, Nov 26 (Reuters) - Tritel Inc., an AT&T Corp. (NYSE:T - news) Wireless affiliate with licenses to provide personal communications services (PCS) to about 14 million people in the south-central United States, set Friday the terms of its previously announced initial public offering.
Tritel provides PCS services as a member of the AT&T Wireless Network, serving as the preferred roaming adviser to AT&T Wireless's digital wireless customers in nearly all of Tritel's markets and co-branding its services with the AT&T and SunCom brands and logos, according to the SEC filing.
Tritel, based in Jackson, Miss., plans to offer 9.375 million class A common shares that may be priced between $15 and $17 per share. The shares represent a stake of about 7.7 percent in the company.
If there were heavy demand for those shares, then the underwriters, who include Goldman Sachs and Merrill Lynch, would have an option to buy 1,406,250 more shares.
Tritel said it plans to make about $138 million after expenses, which the company calculated using the middle of the projected price range.
It hopes to use the net proceeds for general corporate purposes, including capital expenditures related to the construction of a PCS services network; sales and marketing; working capital; and possible acquisitions of licenses and properties.
Tritel, which has applied to have the shares traded on Nasdaq under the symbol (NasdaqSC:TTEL - news), disclosed the terms of the initial stock sale for the first time in a Securities and Exchange Commission filing.
Tritel is a development stage company with limited operations andno major revenues and expects to have significant operating losses in its initial stages of operation.
It said it has recently begun providing wireless services in six of its major markets.
AT&T Wireless is the company's biggest shareholder with a stake of 21.9 percent before the IPO. Tritel said it has also joined with two other AT&T Wireless affiliates -- Triton PCS Inc. and TeleCorp PCS Inc. -- to operate under a common regional brand name, SunCom.
The Wall Street Journal reported Friday that AT&T, which many analysts had expected to launch a tracking stock for its wireless business, was considering an initial public offering of the unit.
The newspaper, citing unnamed sources, said the No. 1 U.S. long distance telephone company was weighing an IPO of 10 to 15 percent of the wireless unit that could generate $8 billion to $10 billion, which AT&T would invest in the business.
AT&T declined to comment on the story.
Such a deal would be the largest IPO ever in the United
States.
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