Fixed Wireless in Europe FIRSTMARK COMMUNICATIONS SECURES FINANCING COMMITMENT FOR MORE THAN US$1 BILLION INCLUDING LARGEST PRIVATE TELECOMS EQUITY FINANCING IN EUROPEAN HISTORY
LONDON – 8 June 2000
Appoints Prominent Pan-European Board
FirstMark Communications Europe SA, the pan-European Broadband Internet company, today announced that it has secured financing commitments totalling more than US$1 billion, including $600 million of equity from a prominent group of private investors. This transaction is the single, largest equity financing agreement in history for a private company in the telecoms sector in Europe. FirstMark also announced today the appointment of a group of global business leaders and investors to its Board of Directors.
The US$1 billion financing funds FirstMark’s current business plan well into 2001 and will be used for the continued build-out and expansion of the company’s pervasive broadband network infrastructure throughout Europe. The capital from the private equity financing will be immediately accessible upon closing. In addition to the $600 million private equity financing, FirstMark has obtained debt financing commitments for EUR 480 million.
Investors
In the US$600 million private equity round, FirstMark has attracted investors from leading global private equity investment firms, international investment banks, European commercial banks and European industrial corporations. The investor group is led by Welsh, Carson, Anderson & Stowe (WCAS), with significant roles by Kohlberg Kravis Roberts & Co.; Morgan Stanley Dean Witter; funds affiliated to Goldman Sachs & Co.; as well as ABN Amro; Sandler Capital Management; Suez Lyonnaise des Eaux; Arnault Group; the Rallye-Casino Group; E.T.M.F. II L.P., a private equity fund sponsored by BNP Paribas; Francarep, SA, an affiliate of Rothschild & Cie; and Credit Suisse First Boston Equity Partners, L.P.
Proceeds from the private equity investment will be used to expand the build-out of wireless local loop, xDSL and optical fibre networks in Germany, Spain, Luxembourg, Switzerland and Portugal where FirstMark has won Wireless Local Loop (WLL) licenses covering a population of over one hundred million people. In addition, FirstMark intends to continue the strategic acquisition of Wireless Local Loop (WLL) spectrum assets throughout Europe, as well as the expansion of its fibre networks in Germany, France and Spain. FirstMark will continue commercial operations in Germany and expects to be operational in France, Spain, Portugal and Luxembourg by early 2001.
The EUR 480 million senior debt financing has been arranged and underwritten by Deutsche Bank AG. Syndication will be launched in the coming weeks. These funds will be used to meet the capital expenditure requirements for FirstMark’s Wireless Local Loop network in Germany. FirstMark has selected Siemens AG as the turnkey integrator and equipment provider for this project.
Lynn Forester, Founder and Co-Chairman of FirstMark Communications Europe, commented: "This round of financing allows FirstMark to aggressively pursue its vision and business strategy of building the largest Broadband Internet infrastructure in Europe and serving the needs of small and medium enterprises (SMEs), while the appointment of the European Board brings additional strategic strength. All countries where we have been granted licenses have committed themselves to economic policies that are favourable to SMEs. The business of FirstMark is to bring to those companies all the power of the digital age."
Michael J. Price, Co-Chairman of FirstMark Communications, said: "This unprecedented funding of a private telecoms company is a clear statement of support from highly disciplined investors and banks. They understand that FirstMark has the right technology, the right geographic market, and the right customer proposition. We’re especially pleased because recent market conditions have caused investors to be particularly selective in their funding choices. This is a strong endorsement for FirstMark and its vision of building a pan-European broadband Internet network."
European Board of Directors
In addition to the principals from the company, the Board of Directors includes Victor Bischoff, Chief Financial Officer of the Sandoz Foundation; Juan Luis Cebrian, Chief Executive Officer of Grupo Prisa; Francois Jaclot, Vice Chairman of the executive board of Suez Lyonnaise des Eaux; Sir Evelyn de Rothschild, Chairman of N.M. Rothschild & Sons Ltd.; Helmut Werner, former Chief Executive Officer of Mercedes Benz; Edward Gilhuly, Managing Director, Kohlberg Kravis Roberts & Co.; Alan Goldberg, Chairman and CEO, Morgan Stanley Dean Witter Private Equity; David Lee, General Partner, of Sandler Capital Group; Lawrence B. Sorrel, General Partner, Welsh, Carson, Anderson & Stowe, VIII L.P.; and Barry S. Volpert, Managing Director, Goldman Sachs & Co.
The newly appointed Board complements the existing Board of Advisors of FirstMark Holdings, LLC – the parent of FirstMark Communications – which is chaired by Bert Roberts, Chairman of MCI WorldCom, and includes Nathan Myhrvold, former Chief Technology Officer of Microsoft Corp.; Sir Evelyn de Rothschild, Chairman of N.M. Rothschild & Sons Ltd., Dr. Henry Kissinger, Chairman of Kissinger Associates, Inc.; Vernon Jordan, Senior Managing Director of Lazard Freres & Co. LLC; and Bernard Smedley, President and CEO of Exigent International, Inc.
Lynn Forester added: "The appointment of this diverse group of European and international business and finance leaders to our Board of Directors strengthens an impressive management team and broadens our appeal to strategic partners, suppliers and customers."
Tim Samples, President and Chief Executive Officer of FirstMark, commented: "The combination of our business strategy and network build-out, our record-breaking financing agreements and the collective strength of our boards, puts FirstMark well ahead of its competitors in the race to provide ubiquitous and affordable bandwidth access to small and medium-sized businesses in Europe. The time, and the place, is right for FirstMark to succeed."
About FirstMark Communications
FirstMark Communications is currently building the largest and most pervasive end-to-end broadband Internet network infrastructure throughout Europe that will connect 170 cities in 18 countries. The company will use wireless local loop licenses for last mile broadband connectivity. The company currently has licences that cover 100 million people throughout Europe. Today, FirstMark operates a nationwide high-speed optical fibre network in Germany that extends more than 3,500 kilometres, connecting 21 cities. Recently, FirstMark announced its plans to build a nationwide high-speed optical fibre network in France that will extend more than 5,000 km, connecting 18 cities.
FirstMark will offer a full suite of communications, hosting and applications services for commercial businesses and Internet solution providers.
The company currently has Wireless Local Loop (WLL) licenses covering Germany, Spain, Luxembourg, Portugal, Switzerland and Finland. Business development activities are ongoing in France, Netherlands, Belgium, United Kingdom Austria, and the Czech Republic,. FirstMark is based in Luxembourg. Further information is available from www.firstmark.net |
