Morning Jane, You asked me about Gems once before. This release I think has the potential to be a catalyst for the stock and company earnings going forward. MarkC Alternative Financing for Glenayre Pagers Paves the Way for Expansion ofPaging Market; Carriers and End-Customers Win with New Financing Option
SANTA CLARA, Calif., March 1 /PRNewswire/ -- Glenayre's Wireless Access Group and Golden Eagle Credit Corporation have teamed to offer an industry first that will benefit customers and carriers, as well as support the growth and expansion of the paging industry: leasing of pagers directly to the end- customer.
Customer Benefits. The new leasing arrangement will make it possible for more companies to implement the latest paging technology by eliminating the capital expenditures required today. For example, a company that could benefit from two-way paging may not be willing to purchase 100 two-way pagers (approximately $20,000), but would implement the technology for a small monthly leasing fee. In addition, the new leasing option does not translate into complexity for the customer - the customer can receive a single bill for usage and equipment from the paging carrier.
Carrier Benefits. This leasing option allows carriers to shift one of their largest capital expenditures - pagers - off the balance sheet. For a large carrier, this is significant. For example, on a purchase of 100,000 pagers, a carrier might spend $20 million dollars or more. This new leasing option allows that capital to be reallocated to upgrading the network or other key business initiatives.
Market Expansion. The new leasing option paves the way for an increase in advanced messaging carriers and customers. The elimination of the major capital expense for the purchase of pagers will enable smaller carriers to enter the advanced services market by leasing pagers and reselling network time. Such reselling agreements will allow smaller carriers to expand their business while helping the larger carriers reach markets that were previously inaccessible.
Prior to the Golden Eagle leasing options, carriers purchased pagers, which were then either purchased by or rented to end-customers. Pagers that were rented remained on the carrier balance sheet. In addition, if end- customers chose to lease, they had to pursue service with a carrier and separately pursue leasing through a leasing company. The new leasing arrangement being announced by Glenayre and Golden Eagle provides one-stop- shopping simplicity for the customer, with just one bill for lease and service.
"This new leasing option demonstrates our commitment to the expansion of the advanced messaging market. It delivers balance sheet flexibility to the carriers. It provides a new sales tool for the carrier sales force. It provides an affordable means for customers to implement advanced wireless messaging technology," said Gary Hermansen, president and general manager of Glenayre's Wireless Access Group. "A seemingly simple arrangement, it supports the paging industry in many ways, and is yet another step toward achieving our goal of being the largest and most profitable provider of wireless messaging and information products."
"Our teamwork with Wireless Access has enabled us to offer this alternative financing across the paging industry," said Len Friedlander, president of Golden Eagle Credit Corporation. "We are proud to be the paging industry's first provider of this type of leasing program."
Further information on Golden Eagle Credit Corporation can be found on the company's Web site at: goldeneaglecredit.com or call 800-WE-LEASE.
For over 30 years, Glenayre Technologies Inc. (Nasdaq: GEMS) has been developing and providing leading edge personal telecommunication systems. Glenayre is a premiere designer and producer of advanced, two-way pagers that operate on the ReFLEX protocol. With over 2,000 employees and with products installed in over 100 countries, Glenayre's net sales exceeded $399 million in 1998. Additional information about Glenayre is available on the company's Web site at: glenayre.com .
SOURCE Glenayre Technologies Inc.
CO: Glenayre Technologies Inc.; Golden Eagle Credit Corporation
ST: California, North Carolina
IN: TLS
SU: PDT
03/01/99 09:14 EST prnewswire.com
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