What's next....building a network or selling off the rest of the licenses?
biz.yahoo.com
Cingular Wireless and NextWave Telecom Agree to Terms for Spectrum Licenses
Tuesday August 5, 8:46 am ET
ATLANTA and WASHINGTON, Aug. 5 /PRNewswire/ -- Cingular Wireless and NextWave Telecom today announced an agreement for Cingular to purchase licenses from NextWave to provide wireless services in 34 markets for $1.4 billion.
The licenses, which cover approximately 83 million potential customers, are for spectrum primarily in markets where Cingular currently has voice and data operations.
The transaction is subject to review and approval by the Bankruptcy Court overseeing NextWave's reorganization and by the FCC.
"While this deal allows Cingular to enhance our spectrum position in many of our larger existing markets, it is primarily for the future growth of the company," said Mark Feidler, Chief Operating Officer for Cingular Wireless. "This spectrum will allow us more room to provide additional services and products, to expand coverage in some of our key markets and to better accommodate overall growth."
"This agreement represents a major step forward in our reorganization process," said Allen Salmasi, NextWave's Chairman and CEO. "The proceeds of the deal will enable us to satisfy a significant portion of our obligations to the government and to other creditors. The transaction strengthens NextWave's capitalization and positions the company to complete its reorganization and initiate the build out of its next generation broadband wireless network in a significant number of markets, including New York, Los Angeles, Washington, D.C., and in other major markets around the country."
Under terms of the deal, Cingular would pay $1.4 billion in cash, and obtain FCC authorization to operate on 10 MHz of broadband PCS (1900 MHz) spectrum in the following markets:
Los Angeles, CA; Chicago, IL; San Francisco, CA; Dallas, TX; Houston, TX; Washington, DC; Atlanta, GA; Boston, MA; San Diego, CA; Baltimore, MD; Portland, OR; Sacramento, CA; Las Vegas, NV; Salt Lake City, UT; Allentown, PA; Harrisburg, PA; Springfield, MO; Sarasota, FL; Manchester, NH; Portland, ME; Lakeland, FL; York, PA; Lancaster, PA; Poughkeepsie, NY; Reading, PA; Hagerstown, MD; Temple, TX; Gainesville, FL; Tyler, TX; Joplin, MO; Salisbury, MD; and Kankakee, IL.
Cingular would also obtain FCC authorization to operate on 20 MHz in the 1900 MHz band in Tampa, FL and El Paso, TX.
Cingular currently provides service in all of these markets except for Portland, OR; Salt Lake City, UT; El Paso, TX; Manchester, NH; Hagerstown, MD; Salisbury, MD; and Kankakee, IL.
NextWave also holds FCC authorizations to operate on 1900 MHz spectrum in 61 other markets.
The two companies will present the bidding procedures relating to the offer and, ultimately, the results of an auction to be held by NextWave to the U.S. Bankruptcy Court for the Southern District of New York for its approval. NextWave voluntarily initiated bankruptcy reorganization procedures in June 1998.
Once bankruptcy court approval is obtained, the transaction will be submitted to the FCC for approval of the license transfers. NextWave and the FCC have negotiated a separate term sheet that provides for payment of NextWave's financial obligation to the U.S. Treasury associated with the license rights to be assigned to Cingular.
ABOUT CINGULAR WIRELESS
Cingular Wireless, a joint venture between SBC Communications (NYSE: SBC - News) and BellSouth (NYSE: BLS - News), serves more than 23 million voice and data customers across the United States. A leader in mobile voice and data communications, Cingular is the only U.S. wireless carrier to offer Rollover, the wireless plan that lets customers keep their unused monthly minutes. Cingular has launched the world's first commercial deployment of wireless services using Enhanced Data for Global Evolution (EDGE) technology. Cingular provides cellular/PCS service in 43 of the top 50 markets nationwide, and provides corporate e-mail and other advanced data services through its GPRS, EDGE and Mobitex packet data networks. Details of the company are available at www.cingular.com .
ABOUT NEXTWAVE TELECOM
NextWave Telecom Inc. was formed in 1995 to provide broadband wireless services to consumer and business markets. For more information about NextWave, visit its Web site at nextwavetel.com . |
